15-10-15 Oracle Motion To Disqualify Damages Expert

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 1 of 9
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ORRICK, HERRINGTON & SUTCLIFFE LLP

KAREN G. JOHNSON-MCKEWAN (SBN 121570)
kjohnson-mckewan@orrick.com
ANNETTE L. HURST (SBN 148738)
ahurst@orrick.com
GABRIEL M. RAMSEY (SBN 209218)
gramsey@orrick.com
405 Howard Street, San Francisco, CA 94105
Tel: 1.415.773.5700 / Fax: 1.415.773.5759
PETER A. BICKS (pro hac vice)
pbicks@orrick.com
LISA T. SIMPSON (pro hac vice)
lsimpson@orrick.com
51 West 52nd Street, New York, NY 10019
Tel: 1.212.506.5000 / Fax: 1.212.506.5151
BOIES, SCHILLER & FLEXNER LLP
DAVID BOIES (pro hac vice)
dboies@bsfllp.com
333 Main Street, Armonk, NY 10504
Tel: 1.914.749.8200 / Fax: 1.914.749.8300
STEVEN C. HOLTZMAN (SBN 144177)
sholtzman@bsfllp.com
1999 Harrison St., Ste. 900, Oakland, CA 94612
Tel: 1.510.874.1000 / Fax: 1.510.874.1460
ORACLE CORPORATION
DORIAN DALEY (SBN 129049)
dorian.daley@oracle.com
DEBORAH K. MILLER (SBN 95527)
deborah.miller@oracle.com
MATTHEW M. SARBORARIA (SBN 211600)
matthew.sarboraria@oracle.com
500 Oracle Parkway,
Redwood City, CA 94065
Tel: 650.506.5200 / Fax: 650.506.7117
Attorneys for Plaintiff
ORACLE AMERICA, INC.
UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION
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ORACLE AMERICA, INC.,

Plaintiff,
v.
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Case No. CV 10-03561 WHA

NOTICE OF MOTION AND MOTION
TO DISQUALIFY THE RULE 706
EXPERT
GOOGLE INC.,
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Defendant.
Date: November 19, 2015

Time: 8:00 a.m.
Dept.: Courtroom 8, 19th Floor
Judge: Honorable William H. Alsup
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MOTION TO DISQUALIFY
THE RULE 706 EXPERT
CV 10-03561 WHA
NOTICE OF MOTION AND MOTION
TO ALL PARTIES AND THEIR COUNSEL OF RECORD: PLEASE TAKE NOTICE
THAT the following Motion to Disqualify the Rule 706 Expert will be heard on November 19,
2015 at 8:00 a.m., or as soon thereafter as counsel may be heard, in Courtroom 8, 19th Floor of
this Court, located at 450 Golden Gate Avenue, San Francisco, California, the Honorable William
H. Alsup presiding. Plaintiff Oracle America, Inc. will and hereby does move to disqualify the
Courts Rule 706 expert on the grounds that it is no longer appropriate for Dr. Kearl to serve as a
neutral expert based on his work since the last trial, and that no other Rule 706 expert is needed in
light of the reduced scope of the case.
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This motion is based on the Notice of Motion and Motion to Disqualify the Rule 706
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Expert, the following Memorandum of Points and Authorities, the Declaration of Peter A Bicks,
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the pleadings and papers on file in this action, and such other and further papers and argument
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presented prior to or at the hearing on the Motion.
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Dated: October 15, 2015
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/s/ Peter A. Bicks

PETER A. BICKS
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Attorney for Plaintiff

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THE RULE 706 EXPERT
CV 10-03561 WHA
MEMORANDUM OF POINTS AND AUTHORITIES
INTRODUCTION
It is no longer appropriate for Dr. Kearl to serve as a neutral expert in this case. When he
was hired by Samsung in Apple v. Samsung, he sided with Google in a highly-publicized case
where the patents at issue involved technology that is part of Android. The case, still ongoing in
this district, was effectively Apple v. Google: Google agreed to indemnify Samsung, the very
same attorneys represented Google and Samsung, and Google had control and authority over
Samsungs defense. And one of the issues in that case was whether, as Apple argued, Samsung
used Dr. Kearls analysis to give the jury a low damages number in an attempt to make all patents
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appear to have little value. Or, as Apple asked the jury, why else would Samsung pay experts $5
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million to pursue a $6 million claim if not to try to devalue patents? Having an expert wear the
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hat of a neutral party in this case when he previously wore an Android hat is prejudicial to Oracle
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and risks injecting complications into the case that should be avoided.
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Nor should the Court replace Dr. Kearl because a Rule 706 expert is no longer necessary
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in this case. The damages analysis will not have the same complexity now that the patent claims
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are out of the case. The parties experts in the normal adversary process will sufficiently present
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the issues to the Court and the jury. If the Court nevertheless concludes that an expert is
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necessary to assist the Court in evaluating the reports of the parties experts, the parties should
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jointly select a neutral expert who should not testify in front of the jury.
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ARGUMENT
I.
It Is Inappropriate For Dr. Kearl To Remain As A Neutral Expert.
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Because a Rule 706 expert is appointed by the Court, he must remain neutral throughout
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the proceedings. See Students of California Sch. for the Blind v. Honig, 736 F.2d 538, 549 (9th
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Cir. 1984) (Rule 706 allows the court to appoint a neutral expert on its own motion.); vacated
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on other grounds, 471 U.S. 148, 149-50 (1985); Gorton v. Todd, 793 F. Supp. 2d 1171, 1177
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(E.D. Cal. 2011) (The Rule only allows a court to appoint a neutral expert.). This Court has
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also recognized a Rule 706 experts neutrality, stating that the expert should provide a neutral
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explanation and viewpoint, ECF 236 at 2, have no conflicts, ECF 610 at 4, and be
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CV 10-03561 WHA
unimpeachable, ECF 350 at 23.
Since Dr. Kearl testified in Apple v. Samsungnot as a neutral expert but, as we now
know, one hired by Samsung1it is no longer appropriate for him to serve in this neutral role.
Samsung is a leading Android device maker. And while Samsung was named as the defendant in
Apple v. Samsung, Samsung argued that the case was really about Apple versus Googles
Android. Samsung Tr. 367.2 This was not an offhand remark, it was one of Samsungs major,
oft-repeated themes: Its an attack on Android. Its an attack, its an attack . . . Its the truth.
Its an attack on Android, and thats what this case is. Id. at 358-59; see also, e.g., id. at 372 (A
holy war on Android.); id. at 359 (Apple is trying to limit consumer choice and to gain an
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unfair advantage over its one major competitor, Googles Android.); id at 3267 ([W]e have a
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holy war with Google). Samsung made this argument because the patents at issue dealt with
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software features that are in Googles Android, not hardware that is part of Samsungs equipment.
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Id. at 356-57. For example, one patent involved technology that allowed a user to run a search
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both on the internet and locally on the phone. Id. at 1929. Even Apples counsel quoted an article
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describing the search ability as an awesome feature for Android. Id. at 323.
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On top of that, one of Samsungs main defenses was that Googles engineers are so
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skilled, they would never copy. See, e.g., id. at 356 ([The] accused features on [the Samsung]
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phone were developed independently by . . . the software engineers at Google . . . .); id. at 368
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(Googles engineers dont need to copy Apple.); id at 370 (the hard work and the ingenuity of
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the engineers at Google); id. at 356 (most sophisticated and creative minds in the smartphone
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industry); id. at 368 (they can do just about anything); id. at 3258 (brilliant engineers, [at]
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Google, right up the street); id. at 3265 (these independent geniuses at Google). That defense
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made by the party who hired Dr. Kearl undermines his neutrality. In our case, it has already been
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determined that Google did copy thousands of lines of Oracles code rather than create its
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See Declaration of Peter A. Bicks (Bicks Decl.) Ex. 5 (Dr. Kearl Apple v. Samsung Corrected
Expert Report) at 3.
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Citations to the trial transcript from Apple v. Samsung will be Samsung Tr. __. See Bicks
Decl. Ex. 1, 3-4. Citations to docket entries from that case will be Samsung ECF __. See
Bicks Decl. Ex. 3. The Apple v. Samsung docket number is 12-CV-00630-LHK (N.D. Cal.).
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CV 10-03561 WHA
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libraries entirely from scratch.

Dr. Kearl argues that the Apple v. Samsung cases emphasis on Android is not relevant
because Dr. Kearl was involved with Samsungs counterclaims against Apple, which meant his
analysis focused on the value of the asserted patents in the Apple products. ECF 1313 at 4.
Accordingly, Dr. Kearl claims, to the degree that a mobile operating system or platform was
relevant, that operating system would have been the Apple iOS operating system and not
Android. ECF 1313 at 4. But that point fails to appreciate Oracles concerns with Dr. Kearl
serving as a neutral expert. The issue is not whether his analysis specifically dealt with Android.
A jury may well not appreciate that fine parsing of Dr. Kearls role. The issue is that Dr. Kearl
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was on the Android/Google side of an extremely significant case, no matter whether he was on
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offense, defense, or special teams.
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Indeed, Google was involved in that case even more than being a focal point of the trial.
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Google agreed to indemnify Samsung, as one Google lawyer testified in a 30(b)(6) deposition.
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Samsung ECF 1920 at 13; Samsung Tr. 2785. As part of that indemnity, Google had the authority
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to control the litigation and defense. Samsung ECF 1920 at 16; see also id. at 17 (noting that
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Google has control and authority over the defense of at least two of the patents at issue).
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The Google-Samsung connection was so strong that Google and Samsung were even
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represented by the same attorneys in Apple v. Samsung. For some third party discovery issues,
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Google itself filed briefs, rather than acting through Samsung. See, e.g., Samsung ECF 142. On
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the Apple v. Samsung docket, all the attorneys representing Google are also attorneys representing
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Samsung. See Samsung docket 12-CV-00630-LHK. There was effectively no difference
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between Samsung and Google.
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Dr. Kearl nevertheless contends that he was not part of any strategy of defending
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Android because he was involved in Samsungs counterclaims against Apple. ECF 1313 at 4.
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This is at best a superficial approach. Apple laid bare the real strategy: that those counterclaims
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were a key part of Samsungs defense. Apple asked for over $2 billion in damages, Samsung Tr.
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337. (It had just secured a $1 billion award against Samsung, see Apple Inc. v. Samsung
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Electronics Co., 786 F.3d 983, 989 (Fed. Cir. 2015)). Samsung asserted patent counterclaims
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CV 10-03561 WHA
and, based on Dr. Kearls analysis, asked for only approximately $6 million. Samsung Tr. 3321.
Apple argued that Samsung was using Dr. Kearl to make all patents in the smartphone space seem
like they have a low value. Apple told the jury that it only made sense for Samsung to pay its
experts over $5 million to pursue a $6 million claim in one circumstance: [I]f youre trying to
devalue patents, all patents. Id. at 3350-51; see also id. (To devalue, to cheapen, to convince
you that patents are not worth that much.); id. at 343 (They want you to believe that patents are
not worth much.).
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Apple also suggested that Dr. Kearl artificially lowered his calculations, pointing to a part
of Dr. Kearls report where he stated that [t]he value that . . . users placed on Facetime [an
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allegedly infringing Apple feature] is likely higher, and likely many times higher, than the $.99
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amount I used in my calculations. Samsung Tr. 2673-74.
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See Bicks Decl. Ex. 5 (Dr. Kearl Apple v.
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Samsung Corrected Expert Report) at Tables 17a-f. Samsung, for its part, told the jury that
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Apples billion dollar numbers are completely unsupported, and that it would show [the jury]
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how properly to calculate a royalty, by demonstrating how Dr. Kearl calculated these
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damages. Samsung Tr. at 412. In other words, Samsungs lawyers directly offered Dr. Kearls
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analysis as a rebuttal approach on the Android claims, not just as an affirmative calculation on
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Samsungs counterclaims.
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Because Dr. Kearl was on the Android side of Apple v. Samsung, it is no longer proper for
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him to serve as a neutral expert here. A Rule 706 expert is cloaked in the authority of the Court.
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Cf. 29 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure 6302 (2015)
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([B]ecause of the experts link to the court, a jury may fail to scrutinize his testimony to the
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same extent it would the testimony of party experts. Thus, the testimony of a court-appointed
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expert may undermine rather than promote accurate factfinding.). Both Dr. Kearl and Samsung
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appeared to recognize the power of a court endorsement. Of all the times that Dr. Kearl has
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served as an expert witness, Samsung asked Dr. Kearl only about his role in this case during the
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THE RULE 706 EXPERT
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Samsung trial. Dr. Kearl answered by highlighting that he was hired neither for a plaintiff nor for
a defendant, but for the Court in this case: Ive been an expert witness in a lot of cases, both for
plaintiffs and defendants. But a few years ago, I was hired by Judge William Alsup of the
Northern District of California to be a court expert, to be his expert. Samsung Tr. 2657. During
closing statements, Samsung emphasized Dr. Kearls neutrality in our case as a reason for his
reliability: [He] even was retained by the court to serve as a neutral expert for the court in
another case. Samsung Tr. 3319.
Given Dr. Kearls participation in Samsung/Googles defense, he should not remain as
this Courts expert. Retaining him as a neutral expert is inviting real prejudice to Oracle and
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confusion for the jury. As previously discussed, Dr. Kearls testimony at trial would force Oracle
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to steer between Scylla and Charybdis. See ECF 1311 at 5. Normally, a party could cross-
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examine an expert about his ties to the opposing side. But because Dr. Kearl is the Courts
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expert, that approach risks suggesting to the jury that the Court has in some way endorsed
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Googles side. And the jury may already be confused about why its hearing from a third expert
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on the damages issue. The other option, not raising the Apple v. Samsung case at all, means not
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being able to expose to the jury potential biases as would be possible with any other expert.
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Dr. Kearl should no longer serve as a Rule 706 expert in this case.
II.
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A Rule 706 Expert Is No Longer Necessary.

The Court should not appoint any Rule 706 expert to replace Dr. Kearl becauseas
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Oracle previously explained, see ECF 1311 at 5-7a Rule 706 expert is no longer necessary
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(though Oracle acknowledges that the Court previously stated that it would reevaluate the need
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for a Rule 706 expert after the parties submit their expert damages reports, July 30, 2015 Tr. at
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48-50).
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Rule 706 should be invoked only in rare and compelling circumstances. Monolithic
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Power Sys., Inc. v. O2 Micro Intl Ltd., 558 F.3d 1341, 1348 (Fed. Cir. 2009). That appointment
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is generally reserved for complex scientific, medical or technical matters, Armstrong v. Brown,
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768 F.3d 975, 987 (9th Cir. 2014); see, e.g., Walker v. Am. Home Shield Long Term Disability
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Plan, 180 F.3d 1065, 1071 (9th Cir. 1999) (involving contradictory evidence about an elusive
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disease of unknown cause).
The damages calculations are not as complex as they were when the patent claims were
still in the case. In November 2011, the Court explained that an important reason why the
damages issue was particularly involved was that [d]amages from patent infringement are
governed by different legal standards than damages from copyright infringement, [and] some
accused products and acts are relevant to both parts of the action. ECF 610 at 2. This
complication no longer exists. Whatever may be said of the significantly more complex first trial,
Oracle does not intend to assert complicated damage theories at the retrial. See ECF 1321 at
13. And the Court will be able to decide for itself once it has the opportunity to review the
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parties expert reports.
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III.
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A Rule 706 Expert Should Not Testify At Trial.

Even if the Court determines that it still requires a Rule 706 expert, the parties should
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jointly select a neutral expert who should not testify in front of the jury. As Google previously
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explained: If the jury also hears testimony from a third, neutral expert, that will further
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complicate the jurys decision on damages. Moreover, if the jury is aware that the Courts expert
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was appointed by the Court and is not a representative of the parties, that expert will have a
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powerful stamp of Court approval and objectivity that will lend a disproportionate weight to that
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experts opinions and testimony. ECF 235 at 3. Oracle agrees. Any Rule 706 expert should not
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testify at the trial.
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CONCLUSION
Dr. Kearl should no longer serve as a Rule 706 expert in this case, and the Court should
not appoint a new expert.
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THE RULE 706 EXPERT
CV 10-03561 WHA
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Dated: October 15, 2015
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KAREN G. JOHNSON-MCKEWAN
ANNETTE L. HURST
GABRIEL M. RAMSEY
PETER A. BICKS
LISA T. SIMPSON
Orrick, Herrington & Sutcliffe LLP
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By: /s/ Peter A. Bicks

PETER A. BICKS
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Case 3:10-cv-03561-WHA Document 1340-1 Filed 10/15/15 Page 1 of 3
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ahurst@orrick.com
gramsey@orrick.com
Tel: 1.415.773.5700 / Fax: 1.415.773.5759
pbicks@orrick.com
lsimpson@orrick.com
Tel: 1.212.506.5000 / Fax: 1.212.506.5151
dboies@bsfllp.com
Tel: 1.914.749.8200 / Fax: 1.914.749.8300
Tel: 1.510.874.1000 / Fax: 1.510.874.1460
ORACLE CORPORATION
500 Oracle Parkway,
Tel: 650.506.5200 / Fax: 650.506.7117
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Plaintiff,
v.
GOOGLE INC.
Defendant.

DECLARATION OF PETER A. BICKS
IN SUPPORT OF ORACLES MOTION
TO DISQUALIFY THE RULE 706
EXPERT
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CV 10-03561 WHA
I, Peter A. Bicks, declare and state as follows:
1.
I am a partner with the law firm of Orrick, Herrington & Sutcliffe LLP (Orrick),
attorneys of record for plaintiff Oracle America, Inc. (Oracle). I am a member of the bar of the
State of New York and have been admitted pro hac vice in this action. I am familiar with the
events, pleadings and discovery in this action and, if called upon as a witness, I could and would
testify competently to the matters stated herein of my own personal knowledge.
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I submit this declaration in support of Oracles Motion to Disqualify the Rule 706
3.
On September 10, 2015, Oracle submitted to this Court Dr. James Kearls trial
Expert.
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2.
testimony in Apple v. Samsung, 12-CV-00630-LHK (N.D. Cal.) See ECF 1311-10, 1311-11.
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4.
Attached as Exhibit 1 is a true and correct copy of the April 1, 2014 trial transcript
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from Apple v. Samsung. This transcript includes the opening statements from Apple and
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Samsung.
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5.
Attached as Exhibit 2 is a true and correct copy of Exhibit 3010 in Apple v.
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Samsung. It is ECF 1920 in that case. This exhibit includes a transcript of a video deposition of
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James Maccoun.
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6.
Attached as Exhibit 3 is a true and correct copy of an excerpt of the April 22,
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2014 trial transcript from Apple v. Samsung. This excerpt indicates when James Maccouns
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videotaped deposition was played to the jury.
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7.
Attached as Exhibit 4 is a true and correct copy of the April 29, 2014 trial
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transcript from Apple v. Samsung. This transcript includes the closing arguments from Apple and
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Samsung.
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8.
Attached as Exhibit 5 is a true and correct copy of excerpts from the Corrected
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Expert Report of Dr. James R. Kearl in Apple v. Samsung as produced by Quinn Emanuel.
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///
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///
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///
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///
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CV 10-03561 WHA
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I declare under penalty of perjury under the laws of the United States that the foregoing is
true and correct.
Executed this 15th day of October, 2015, at New York, New York.
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/s/ Peter A. Bicks

Peter A. Bicks
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CV 10-03561 WHA
EXHIBIT 1
Case
Case5:12-cv-00630-LHK
3:10-cv-03561-WHA Document
Document1622
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Filed 10/15/15Page1
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SAN JOSE DIVISION
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APPLE INC., A CALIFORNIA

CORPORATION,
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PLAINTIFF,
VS.
SAMSUNG ELECTRONICS CO., LTD.,
A KOREAN BUSINESS ENTITY;
SAMSUNG ELECTRONICS AMERICA,
INC., A NEW YORK CORPORATION;
SAMSUNG TELECOMMUNICATIONS
AMERICA, LLC, A DELAWARE
LIMITED LIABILITY COMPANY,
DEFENDANTS.
)
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C-12-00630 LHK
SAN JOSE, CALIFORNIA
APRIL 1, 2014
VOLUME 2
PAGES 268-497
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TRANSCRIPT OF PROCEEDINGS
BEFORE THE HONORABLE LUCY H. KOH
UNITED STATES DISTRICT JUDGE
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APPEARANCES ON NEXT PAGE
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OFFICIAL COURT REPORTERS:
LEE-ANNE SHORTRIDGE, CSR, CRR

CERTIFICATE NUMBER 9595
IRENE RODRIGUEZ, CSR, CRR
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PROCEEDINGS RECORDED BY MECHANICAL STENOGRAPHY

TRANSCRIPT PRODUCED WITH COMPUTER
UNITED STATES COURT REPORTERS
Case
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A P P E A R A N C E S:
FOR PLAINTIFF
APPLE:
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MORRISON & FOERSTER

BY: HAROLD J. MCELHINNY
RACHEL KREVANS
425 MARKET STREET
SAN FRANCISCO, CALIFORNIA
94105
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WILMER, CUTLER, PICKERING,

HALE AND DORR
BY: WILLIAM F. LEE
60 STATE STREET
BOSTON, MASSACHUSETTS 02109
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BY: MARK D. SELWYN

950 PAGE MILL ROAD
PALO ALTO, CALIFORNIA
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94304
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QUINN, EMANUEL, URQUHART & SULLIVAN

BY: JOHN B. QUINN
WILLIAM PRICE
865 S. FIGUEROA STREET, FLOOR 10
LOS ANGELES, CALIFORNIA 90017
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BY:
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FOR SAMSUNG:
VICTORIA F. MAROULIS
KEVIN B . JOHNSON
555 TWIN DOLPHIN DRIVE
SUITE 560
REDWOOD SHORES, CALIFORNIA
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94065
Case
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INDEX OF PROCEEDINGS
OPENING STATEMENT BY MR. MCELHINNY
P. 298
OPENING STATEMENT BY MR. LEE
P. 338
OPENING STATEMENT BY MR. QUINN
P. 351
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INDEX OF WITNESSES
PLAINTIFF'S
PHILIP SCHILLER
DIRECT EXAM BY MR. MCELHINNY
CROSS-EXAM BY MR. PRICE
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P. 417
P. 475
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INDEX OF EXHIBITS
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MARKED
ADMITTED
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PLAINTIFF'S
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118
135A
180
1441
113A
127A
133
134
143
123
428
429
432
436
437
439
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441
445
461
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DEFENDANT'S
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APRIL 1, 2014
P R O C E E D I N G S
(JURY OUT AT 9:02 A.M.)
(JUROR ANDERSON PRESENT TELEPHONICALLY.)
JUROR ANDERSON:
THE CLERK:
HI, MS. ANDERSON.
JUROR ANDERSON:
THE COURT:
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WE'RE CALLING FROM THE
COURTROOM.
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THIS IS LAURA ANDERSON.
HELLO.
HI, MS. ANDERSON.
TELL US WHAT IS
HAPPENING TODAY.
JUROR ANDERSON:
I'M NOT FEELING WELL.
I WOKE UP
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EARLY THIS MORNING WITH VOMITING AND DIARRHEA, AND IT'S BEEN
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GOING ON THROUGHOUT THE MORNING.
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MONTEREY TO SAN JOSE.
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THE COURT:
I HAVE BEEN RIDING FROM
I'VE HAD TO PULL OVER MULTIPLE TIMES.

OKAY.
ALL RIGHT.
THEN I -- IS THERE ANY
OBJECTION TO EXCUSING MS. LAURA ANDERSON FOR HARDSHIP?
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MR. LEE:
NONE FOR APPLE, YOUR HONOR.
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MR. QUINN:
NOR FOR SAMSUNG.
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THE COURT:
ALL RIGHT.
THEN, MS. ANDERSON, THANK YOU
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VERY MUCH FOR YOUR SERVICE.
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AND YOU HAVE FULFILLED YOUR JURY DUTY.
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JUROR ANDERSON:
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THE COURT:
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JUROR ANDERSON:
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THE COURT:
WE HOPE THAT YOU RECOVER QUICKLY,
OKAY.
ALL RIGHT.
THANK YOU.
THANK YOU.
THANK YOU.
FEEL BETTER.
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JUROR ANDERSON:
THE COURT:
3
4
5
THANK YOU.
OKAY.
THEN LET'S BRING IN MS. GALONJA,
NUMBER 7.
(JUROR GALONJA PRESENT.)
THE COURT:
MS. GALONJA, WELCOME.
ANYWHERE THAT'S COMFORTABLE FOR YOU.
WHAT ISSUE YOU'RE HAVING?
8
9
10
JUROR GALONJA:
TAKE A SEAT
CAN YOU PLEASE TELL US
FIRST, I HAVE TO APOLOGIZE, AND THEN
I HAVE TO TELL, IT'S AN HONOR FOR ME TO BE CHOSEN HERE.

BUT YESTERDAY WHEN I CAME HOME AND I LOOKED FOR ALL PROS
11
AND, YOU KNOW, AGAINST THE DUTIES, DUTY, I REALIZED I HAVE SOME
12
ISSUE TO ASK YOU TO DISMISS ME BECAUSE YESTERDAY YOU ASKED IF
13
SOMEBODY HAD SOME HARDSHIP FOR THE, LIKE FINANCIAL SIDE, AND
14
FIRST, I HAVE TO APOLOGIZE.
15
IS STILL LIMITED.
16
17
18
19
20
I'M HERE 16 YEARS, BUT MY ENGLISH
FIRST TIME I RAISED THE HAND AND THEN AFTER THAT, BECAUSE
I REALLY DIDN'T THINK I WOULD BE CHOSEN 100 PERCENT.
AND THEN I SAID, OKAY, I'M NOT GOING TO TELL MY REASON
BECAUSE IT'S FINANCIAL SIDE, HARD FOR ME.
BUT WHEN I CAME HOME AND I LOOK ON THAT, YOU KNOW, I'M
21
WORKING TWO PART-TIME JOBS, NOT WELL PAID.
22
WORK FOR FOUR YEARS.
23
24
25
MY HUSBAND DOESN'T
WE HAVE SOME FINANCIAL ISSUE.
AND I LOOK IN MY HANDBOOK, THE SCHOOL DISTRICT WHERE I'M

WORKING, THEY PAY ME, LIKE I WOULD BE PAID $40 PER DAY.
TODAY I LEARNED SOMETHING MORE, AND I WILL BE PAID ONE
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MONTH LATER BECAUSE WE HAVE TO GIVE THE PROOF UNTIL THE 10TH OF
THE MONTH, AND THEN WE'LL BE PAID, YOU KNOW, THE FOLLOWING
MONTH.
4
5
IT MEANS ONE MONTH I WILL BE LATE, AND I LIVE PAY CHECK TO

PAY CHECK.
THE COURT:
JUROR GALONJA:
8
9
10
11
12
13
OKAY.
THERE WILL BE ISSUE FOR ME
FINANCIALLY.
AND THEN I'M NOT DRIVING.
MY HUSBAND GIVE ME RIDE RIGHT
NOW, AND HE WILL PICK ME UP.

THAT MEANS, YOU KNOW, I DON'T HAVE PROOF, I DON'T PARK THE
CAR, I DON'T HAVE MILEAGE.
THE COURT:
OH, WELL, YOUR HUSBAND WOULD STILL GET
14
REIMBURSED FOR THE MILEAGE, EVEN IF YOU'RE NOT DRIVING, WHOEVER
15
IS DRIVING WILL GET REIMBURSED FOR THE MILEAGE.
16
SO YOU WILL GET REIMBURSED FOR THAT.
17
DIFFERENCE, YOU CAN LET ME KNOW.
18
JUROR GALONJA:
IF THAT WOULD MAKE A
AND THEN THIS MORNING I CALL MY
19
JOB -- I WORK IN THE KITCHEN IN THE SCHOOL.
20
HAVE TO FIND SUBSTITUTE FOR ME.
21
FIND, AND THEY TOLD ME THAT.
22
23
YOU KNOW, THEY
IT'S NOT EVERY TIME EASY TO
YOU KNOW, I TOLD MAYBE WHOLE MONTH AND MY SUPERVISOR WAS,

LIKE, OH, YOU KNOW, HOW WE CAN FIND FOR ONE-MONTH SUBSTITUTE?
24
THE COURT:
UM-HUM.
25
JUROR GALONJA:
AND IT'S ALSO ISSUE --
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THE COURT:
DO YOU THINK THAT MIGHT PUT YOUR JOB AT
RISK?
JUROR GALONJA:
THE COURT:
YEAH, I THINK SO.
ALL RIGHT.
IS THERE ANY OBJECTION TO
EXCUSING MS. GALONJA FOR HARDSHIP?
MR. LEE:
NOT FOR APPLE, YOUR HONOR.
MR. QUINN:
NOT FOR SAMSUNG.
THE COURT:
OKAY.
MS. GALONJA, I WANTED TO THANK YOU
SO MUCH FOR YOUR WILLINGNESS TO SERVE, AND I REALLY APPRECIATE
10
THAT YOU TRIED TO SERVE ON THIS JURY AND YOU'VE FULFILLED YOUR
11
DUTY.
12
13
14
SO THANK YOU.
JUROR GALONJA:
OKAY.
I THANK YOU, EVERYBODY, FOR
UNDERSTANDING.
THE COURT:
CAN YOU GO TO THE SECOND FLOOR TO THE
15
JURY ASSEMBLY ROOM, AND THEY CAN WORK OUT ALL OF YOUR
16
PAPERWORK.
17
JUROR GALONJA:
18
THE COURT:
THANK YOU.
19
THE CLERK:
LET ME GO CHECK.
20
MISSING ONE OR TWO.
21
THE COURT:
WE'RE STILL MISSING A JUROR.
22
THE CLERK:
WHEN SHE CAME OUT.
23
THE COURT:
WE HAD BEEN MISSING ONE OR TWO JURORS,
24
25
OKAY.
THANK YOU.
I THINK WE'RE STILL
BUT LET'S SEE IF THEY'VE NOW ARRIVED.

WAIT ONE SECOND.
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(PAUSE IN PROCEEDINGS.)
2
3
THE COURT:
MR. MCELHINNY:
THE COURT:
JUST TWO, ACTUALLY NOT EVEN
OKAY.
YOU'RE SETTLING?
(LAUGHTER.)
8
9
I DID.
ISSUES, WE'VE REACHED AGREEMENT ON SOMETHING.
6
7
THE DOOR IS CLOSED.
I ASSUME YOU STOOD UP FOR AN ISSUE?
4
5
OKAY.
MR. MCELHINNY:
LET'S SEE.
WHAT'S THE CALENDAR DATE?
MR. QUINN AND I WOULD JOINTLY MOVE THE COURT FOR AN ORDER
10
EXCLUDING PERCIPIENT WITNESSES FROM THIS COURTROOM AND THE
11
OVERFLOW COURTROOM DURING THE TRIAL.
12
THE COURT:
13
MR. MCELHINNY:
14
THAT'S GRANTED.
WITH EACH SIDE TO POLICE THEIR OWN
WITNESSES.
15
THE COURT:
THAT'S GRANTED.
16
MR. MCELHINNY:
THAT MOTION IS GRANTED.
AND, SECONDLY, WITH THE COURT'S
17
PERMISSION, AS WE DID IN THE FIRST TRIAL, MR. LEE AND I WOULD
18
LIKE TO SPLIT OUR OPENINGS WITHIN THE TWO CASES WITHIN THE TIME
19
LIMIT THAT YOUR HONOR HAS SET.
20
21
22
23
THE COURT:
THAT'S FINE.
(DISCUSSION OFF THE RECORD BETWEEN THE COURT AND THE

CLERK.)
THE COURT:
LET ME INFORM THE PARTIES THAT
24
MS. NGUYEN, WHO IS JUROR NUMBER 1, HAS JUST INFORMED
25
MS. PARKER BROWN THAT SHE IS GOING ON VACATION AS OF THE
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EVENING OF WEDNESDAY, MARCH 7TH.
THE CLERK:
MAY 7TH.
THE COURT:
MAY 7TH.
SHOULD BE A FULL WEEK OF JURY DELIBERATIONS.
5
6
I'M HOPING THAT THE JURY MAY BEGIN DELIBERATING ON

TUESDAY, APRIL 29TH.
BE HEARD ON THAT?
NOW.
10
MR. LEE:
DO YOU WANT TO
I'M NOT ANXIOUS TO LOSE ANOTHER JUROR RIGHT
I'M ACTUALLY PETRIFIED ABOUT LOSING ANOTHER
JUROR.
12
13
CERTAINLY BY APRIL 30TH, WEDNESDAY.
SO I DON'T PERCEIVE THAT TO BE A PROBLEM.
11
SO THAT WOULD BE, YOU KNOW,
BUT I DON'T THINK IT'S A PROBLEM.
WE SHOULD BE DONE BY
THEN.
14
THE COURT:
OKAY.
15
MR. QUINN:
IT DOESN'T SEEM TO BE A PROBLEM, YOUR
THE COURT:
OKAY.
16
17
MR. QUINN?
HONOR.
SO WHEN SHE COMES OUT, I'M JUST
18
GOING TO REASSURE HER THAT I'VE CONSULTED WITH YOU ALL, AND WE
19
DON'T PERCEIVE THAT TO BE A PROBLEM.
20
OKAY.
THEN I THINK WE HAVE EVERYONE NOW.
21
MS. PARKER BROWN?
IS THAT RIGHT,
22
THE CLERK:
WE DO.
23
THE COURT:
ALL RIGHT.
24
THE CLERK:
I'M GOING TO TAKE A SECOND AND TELL THEM
25
THEN LET'S START.
THAT THEY DON'T HAVE TO SPREAD ALL THE WAY, THEY CAN --
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THE COURT:
I'M SORRY.
HAVE YOU ALREADY DISTRIBUTED THE JURY BINDERS?
THE CLERK:
SURE, THAT'S FINE.
NO.
(DISCUSSION OFF THE RECORD BETWEEN THE COURT AND THE

CLERK.)
THE COURT:
LET ME ASK THE PARTIES, WOULD YOU LIKE
THEM TO GET THEIR JURY BINDERS NOW?
BECAUSE THE JURY INSTRUCTIONS ARE IN THERE.
9
10
AND I THINK MR. SWARUUP CONFIRMED THAT THEY HAVE THE

LATEST VERSIONS.
11
THE COURT:
ALL RIGHT.
WELCOME.
PLEASE TAKE A SEAT.
UNFORTUNATELY, MS. ANDERSON WAS VERY, VERY ILL, HAS HAD A

LOT OF VOMITING.
16
17
THANK YOU.
WELCOME AND GOOD MORNING.
14
15
OKAY.
(JURY IN AT 9:12 A.M.)
12
13
I THINK IT MAKES SENSE
SO SHE HAD TO BE EXCUSED.
AND MS. GALONJA AS WELL HAD SOME PRETTY SEVERE HARDSHIPS.

SO SHE HAD TO BE EXCUSED.
18
SO I HAVE EIGHT OF YOU LEFT AND YOU ARE EACH PRECIOUS, AND
19
I AM GOING TO BE PUTTING IMMUNE ENHANCING POWDERS AND VITAMIN C
20
DRINKS IN THE JURY ROOM.
21
ONE OR TWO EVERY DAY.
22
I'M GOING TO ASK YOU TO EACH DRINK
OKAY.
NO BUNGEE JUMPING, NOTHING CRAZY IN THE NEXT MONTH, REALLY
23
CAUTIOUS, BECAUSE I NEED TO HAVE ALL OF YOU REMAIN ON THE JURY.
24
OKAY?
25
ALL RIGHT.
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2
3
I'M NOW GOING TO READ TO YOU THE PRELIMINARY JURY

INSTRUCTIONS.
AND, MS. NGUYEN, I UNDERSTAND THAT YOU HAVE A VACATION
PLANNED THE EVENING OF MAY 7TH, WEDNESDAY.
BE FINE.
JUROR NGUYEN:
THE COURT:
I THINK THAT SHOULD
OKAY.
WE DO HOPE THAT THE JURY WILL BEGIN
DELIBERATING SOME TIME ON EITHER TUESDAY, APRIL 29TH, OR
WEDNESDAY, APRIL 30TH.
10
11
12
13
SO THAT SHOULD BE SUFFICIENT TIME.
BUT IF IT'S NOT, THEN WE CAN ALWAYS DISCUSS AT THAT POINT

HOW TO PROCEED.
OKAY.
YOU NOW HAVE JURY BINDERS WHICH YOU CAN LOOK
THROUGH THAT HAVE HELPFUL INFORMATION ABOUT THE CASE.
14
I WANT TO POINT YOU TO THE PRELIMINARY JURY INSTRUCTIONS
15
WHICH, EVEN THOUGH YOU HAVE A HARD COPY, I AM REQUIRED TO READ
16
THEM TO YOU.
17
SO IF YOU WOULD PLEASE TURN TO YOUR PRELIMINARY JURY
18
INSTRUCTIONS IN YOUR BINDERS.
19
EVERYONE THERE?
ALL RIGHT.
SO IT'S THE THIRD BIG TAB.
IS
THANK YOU.
20
ALL RIGHT.
21
LADIES AND GENTLEMEN, YOU ARE NOW THE JURY IN THIS CASE.
22
23
DUTY OF THE JURY.
IT IS MY DUTY TO INSTRUCT YOU ON THE LAW.

THESE INSTRUCTIONS ARE PRELIMINARY INSTRUCTIONS TO HELP
24
YOU UNDERSTAND THE PRINCIPLES THAT APPLY TO CIVIL TRIALS AND TO
25
HELP YOU UNDERSTAND THE EVIDENCE AS YOU LISTEN TO IT.
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YOU WILL BE ALLOWED TO KEEP THIS SET THROUGHOUT THE TRIAL
TO WHICH TO REFER.
HOME.
THIS SET OF INSTRUCTIONS IS NOT TO BE TAKEN
ACTUALLY, YOUR JURY BINDERS ARE ALSO NOT TO BE TAKEN HOME.
PLEASE LEAVE THEM IN THE JURY ROOM DURING BREAKS AND IN THE
EVENINGS.
THANK YOU.
THIS SET OF INSTRUCTIONS MUST REMAIN IN THE JURY ROOM WHEN
YOU LEAVE IN THE EVENINGS.
GIVE YOU A FINAL SET OF INSTRUCTIONS.
10
AT THE END OF THE TRIAL, I WILL

IT IS THE FINAL SET OF
INSTRUCTIONS WHICH WILL GOVERN YOUR DELIBERATIONS.
11
YOU MUST NOT INFER FROM THESE INSTRUCTIONS OR FROM
12
ANYTHING I MAY SAY OR DO AS INDICATING THAT I HAVE AN OPINION
13
REGARDING THE EVIDENCE OR WHAT YOUR VERDICT SHOULD BE.
14
IT IS YOUR DUTY TO FIND THE FACTS FROM ALL THE EVIDENCE IN
15
THE CASE.
16
TO YOU.
17
18
19
20
21
22
23
TO THOSE FACTS YOU WILL APPLY THE LAW AS I GIVE IT
YOU MUST FOLLOW THE LAW AS I GIVE IT TO YOU WHETHER YOU

AGREE WITH IT OR NOT.
DO NOT LET PERSONAL LIKES OR DISLIKES, OPINIONS,
PREJUDICES, BIAS OR SYMPATHY INFLUENCE YOUR DECISION.
BIAS INCLUDES BIAS FOR OR AGAINST ANY PARTY OR ANY WITNESS
BASED UPON NATIONALITY, RACE OR ETHNICITY.
THAT MEANS THAT YOU MUST DECIDE THE CASE SOLELY ON THE
24
EVIDENCE BEFORE YOU.
25
DO SO.
YOU WILL RECALL THAT YOU TOOK AN OATH TO
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IN FOLLOWING MY INSTRUCTIONS, YOU MUST FOLLOW ALL OF THEM
AND NOT SINGLE OUT SOME AND IGNORE OTHERS.
IMPORTANT.
THEY ARE ALL
WHAT IS EVIDENCE?
THE EVIDENCE YOU ARE TO CONSIDER IN DECIDING WHAT THE
FACTS ARE CONSISTS OF:
1.
THE SWORN TESTIMONY OF ANY WITNESS;
2.
THE EXHIBITS WHICH ARE RECEIVED INTO EVIDENCE; AND,
3.
ANY FACTS TO WHICH THE LAWYERS HAVE AGREED.
10
WHAT IS NOT EVIDENCE?
11
IN REACHING YOUR VERDICT, YOU MAY CONSIDER ONLY THE
12
13
14
15
TESTIMONY AND EVIDENCE RECEIVED INTO EVIDENCE.

CERTAIN THINGS ARE NOT EVIDENCE, AND YOU MAY NOT CONSIDER
THEM IN DECIDING WHAT THE FACTS ARE.
NUMBER 1.
I WILL LIST THEM FOR YOU.
ARGUMENTS AND STATEMENTS BY LAWYERS ARE NOT
16
EVIDENCE.
17
IN THEIR OPENING STATEMENTS, WILL SAY IN THEIR CLOSING
18
ARGUMENTS, AND AT OTHER TIMES IS INTENDED TO HELP YOU INTERPRET
19
THE EVIDENCE, BUT IT IS NOT EVIDENCE.
20
21
22
THE LAWYERS ARE NOT WITNESSES.
WHAT THEY WILL SAY
IF THE FACTS AS YOU REMEMBER THEM DIFFER FROM THE WAY THE
LAWYERS HAVE STATED THEM, YOUR MEMORY OF THEM CONTROLS.
NUMBER 2.
QUESTIONS AND OBJECTIONS BY LAWYERS ARE NOT
23
EVIDENCE.
ATTORNEYS HAVE A DUTY TO THEIR CLIENTS TO OBJECT
24
WHEN THEY BELIEVE A QUESTION IS IMPROPER UNDER THE RULES OF
25
EVIDENCE.
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YOU SHOULD NOT BE INFLUENCED BY THE OBJECTION OR BY THE
COURT'S RULING ON IT.
NUMBER 3.
TESTIMONY THAT HAS BEEN EXCLUDED OR STRICKEN OR
THAT YOU HAVE BEEN INSTRUCTED TO DISREGARD IS NOT EVIDENCE AND
MUST NOT BY CONSIDERED.
IN ADDITION, SOMETIMES TESTIMONY AND EXHIBITS ARE RECEIVED
ONLY FOR A LIMITED PURPOSE.
INSTRUCTION, YOU MUST FOLLOW IT.
NUMBER 4.
WHEN I GIVE A LIMITING
ANYTHING YOU MAY HAVE SEEN OR HEARD WHEN THE
10
COURT WAS NOT IN SESSION IS NOT EVIDENCE.
YOU ARE TO DECIDE
11
THE CASE SOLELY ON THE EVIDENCE RECEIVED AT THE TRIAL.
12
EVIDENCE FOR A LIMITED PURPOSE.
13
SOME EVIDENCE MAY BE ADMITTED FOR A LIMITED PURPOSE ONLY.
14
WHEN I INSTRUCT YOU THAT AN ITEM OF EVIDENCE HAS BEEN
15
ADMITTED FOR A LIMITED PURPOSE, YOU MUST CONSIDER IT ONLY FOR
16
THAT LIMITED PURPOSE AND FOR NO OTHER.
17
DIRECT OR CIRCUMSTANTIAL EVIDENCE.
18
EVIDENCE MAY BE DIRECT OR CIRCUMSTANTIAL.
DIRECT EVIDENCE
19
IS DIRECT PROOF OF A FACT, SUCH AS TESTIMONY BY A WITNESS ABOUT
20
WHAT THAT WITNESS PERSONALLY SAW OR HEARD OR DID.
21
22
23
CIRCUMSTANTIAL EVIDENCE IS PROOF OF ONE OR MORE FACTS FROM

WHICH YOU COULD FIND ANOTHER FACT.
YOU SHOULD CONSIDER BOTH KINDS OF EVIDENCE.
THE LAW MAKES
24
NO DISTINCTION BETWEEN THE WEIGHT TO BE GIVEN TO EITHER DIRECT
25
OR CIRCUMSTANTIAL EVIDENCE.
IT IS FOR YOU TO DECIDE HOW MUCH
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WEIGHT TO GIVE TO ANY EVIDENCE.
NUMBER 6.
RULING ON OBJECTIONS.
THERE ARE RULES OF EVIDENCE THAT CONTROL WHAT CAN BE
RECEIVED INTO EVIDENCE.
OFFERS AN EXHIBIT INTO EVIDENCE AND A LAWYER ON THE OTHER SIDE
THINKS THAT IT IS NOT PERMITTED BY THE RULES OF EVIDENCE, THAT
LAWYER MAY OBJECT.
8
9
10
11
12
WHEN A LAWYER ASKS A QUESTION OR
IF I OVERRULE THE OBJECTION, THE QUESTION MAY BE ANSWERED

OR THE EXHIBIT RECEIVED.
IF I SUSTAIN THE OBJECTION, THE QUESTION CANNOT BE
ANSWERED AND THE EXHIBIT CANNOT BE RECEIVED.
WHENEVER I SUSTAIN AN OBJECTION TO A QUESTION, YOU MUST
13
IGNORE THE QUESTION AND MUST NOT GUESS WHAT THE ANSWER MIGHT
14
HAVE BEEN.
15
SOMETIMES I MAY ORDER THAT EVIDENCE BE STRICKEN FROM THE
16
RECORD AND THAT YOU DISREGARD OR IGNORE THE EVIDENCE.
THAT
17
MEANS THAT WHEN YOU ARE DECIDING THE CASE, YOU MUST NOT
18
CONSIDER THE EVIDENCE THAT I TOLD YOU TO DISREGARD.
19
CREDIBILITY OF WITNESSES.
20
IN DECIDING THE FACTS IN THIS CASE, YOU MAY HAVE TO DECIDE
21
WHICH TESTIMONY TO BELIEVE AND WHICH TESTIMONY NOT TO BELIEVE.
22
YOU MAY BELIEVE EVERYTHING A WITNESS SAYS, OR PART OF IT, OR
23
NONE OF IT.
24
25
PROOF OF A FACT DOES NOT NECESSARILY DEPEND ON THE NUMBER

OF WITNESSES WHO TESTIFY ABOUT IT.
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2
IN CONSIDERING THE TESTIMONY OF ANY WITNESS, YOU MAY TAKE

INTO ACCOUNT:
3
4
NUMBER 1.
THE OPPORTUNITY AND ABILITY OF THE WITNESS TO
SEE OR HEAR OR KNOW THE THINGS TESTIFIED TO;
NUMBER 2.
THE WITNESS'S MEMORY;
NUMBER 3.
THE WITNESS'S MANNER WHILE TESTIFYING;
NUMBER 4.
THE WITNESS'S INTEREST IN THE OUTCOME OF THE
CASE AND ANY BIAS OR PREJUDICE;
NUMBER 5.
WHETHER OTHER EVIDENCE CONTRADICTED THE
10
WITNESS'S TESTIMONY;
11
NUMBER 6.
12
THE REASONABLENESS OF THE WITNESS'S TESTIMONY
IN LIGHT OF ALL THE EVIDENCE; AND,
13
NUMBER 7.
ANY OTHER FACTORS THAT BEAR ON BELIEVABILITY.
14
THE WEIGHT OF THE EVIDENCE AS TO A FACT DOES NOT
15
NECESSARILY DEPEND ON THE NUMBER OF WITNESSES WHO TESTIFY ABOUT
16
IT.
17
IMPEACHMENT EVIDENCE -- WITNESS.
18
THE EVIDENCE THAT A WITNESS LIED UNDER OATH OR GAVE
19
DIFFERENT TESTIMONY ON A PRIOR OCCASION MAY BE CONSIDERED,
20
ALONG WITH ALL OTHER EVIDENCE, IN DECIDING WHETHER OR NOT TO
21
BELIEVE A WITNESS AND HOW MUCH WEIGHT TO GIVE THE TESTIMONY OF
22
THE WITNESS AND FOR NO OTHER PURPOSE.
23
NUMBER 9.
CONDUCT OF THE JURY.
24
I WILL NOW SAY A FEW WORDS ABOUT YOUR CONDUCT AS JURORS.
25
FIRST, KEEP AN OPEN MIND THROUGHOUT THE TRIAL, AND DO NOT
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DECIDE WHAT THE VERDICT SHOULD BE UNTIL YOU AND YOUR FELLOW
JURORS HAVE COMPLETED YOUR DELIBERATIONS AT THE END OF THE
CASE.
SECOND, BECAUSE YOU MUST DECIDE THIS CASE BASED ONLY ON
THE EVIDENCE RECEIVED IN THE CASE AND ON MY INSTRUCTIONS AS TO
THE LAW THAT APPLIES, YOU MUST NOT BE EXPOSED TO ANY OTHER
INFORMATION ABOUT THE CASE OR TO THE ISSUES IT INVOLVES DURING
THE COURSE OF YOUR JURY DUTY.
THUS, UNTIL THE END OF THE CASE, OR UNLESS I TELL YOU
10
OTHERWISE, DO NOT COMMUNICATE WITH ANYONE IN ANY WAY, AND DO
11
NOT LET ANYONE ELSE COMMUNICATE WITH YOU IN ANY WAY, ABOUT THE
12
MERITS OF THE CASE OR ANYTHING TO DO WITH IT.
13
THIS INCLUDES DISCUSSING THE CASE IN PERSON, IN WRITING,
14
BY PHONE OR ELECTRONIC MEANS VIA E-MAIL, TEXT MESSAGING OR ANY
15
INTERNET CHAT ROOM, BLOG, WEBSITE OR ANY OTHER FEATURE.
16
THIS APPLIES TO COMMUNICATING WITH YOUR FELLOW JURORS
17
UNTIL I GIVE YOU THE CASE FOR DELIBERATION, AND IT APPLIES TO
18
COMMUNICATING WITH EVERYONE ELSE, INCLUDING YOUR FAMILY
19
MEMBERS, YOUR EMPLOYER, AND THE PEOPLE INVOLVED IN THE TRIAL,
20
ALTHOUGH YOU MAY NOTIFY YOUR FAMILY AND YOUR EMPLOYER THAT YOU
21
HAVE BEEN SEATED AS A JUROR IN THIS CASE.
22
BUT IF YOU ARE ASKED OR APPROACHED IN ANY WAY ABOUT YOUR
23
JURY SERVICE OR ANYTHING ABOUT THIS CASE, YOU MUST RESPOND THAT
24
YOU HAVE BEEN ORDERED NOT TO DISCUSS THE MATTER AND TO REPORT
25
THE CONTACT TO THE COURT.
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BECAUSE YOU WILL RECEIVE ALL OF THE EVIDENCE AND LEGAL
INSTRUCTION YOU PROPERLY MAY CONSIDER TO RETURN A VERDICT:
NOT READ, WATCH OR LISTEN TO ANY NEWS OR MEDIA ACCOUNTS OR
COMMENTARY ABOUT THE CASE OR ANYTHING TO DO WITH IT; DO NOT DO
ANY RESEARCH, SUCH AS CONSULTING DICTIONARIES, SEARCHING THE
INTERNET OR USING OTHER REFERENCE MATERIALS; AND DO NOT MAKE
ANY INVESTIGATION OR IN ANY OTHER WAY TRY TO LEARN ABOUT THE
CASE ON YOUR OWN.
DO
THE LAW REQUIRES THESE RESTRICTIONS TO ENSURE THE PARTIES
10
HAVE A FAIR TRIAL BASED ON THE SAME EVIDENCE THAT EACH PARTY
11
HAS HAD AN OPPORTUNITY TO ADDRESS.
12
RESTRICTIONS JEOPARDIZES THE FAIRNESS OF THESE PROCEEDINGS AND
13
A MISTRIAL COULD RESULT THAT WOULD REQUIRE THE ENTIRE TRIAL
14
PROCESS TO START OVER.
15
16
A JUROR WHO VIOLATES THESE
IF ANY JUROR IS EXPOSED TO ANY OUTSIDE INFORMATION, PLEASE

NOTIFY THE COURT IMMEDIATELY.
17
NUMBER 10.
18
DURING DELIBERATIONS YOU WILL HAVE TO MAKE YOUR DECISION
19
BASED ON WHAT YOU RECALL OF THE EVIDENCE.
20
TRANSCRIPT OF THE TRIAL.
21
THE TESTIMONY AS IT IS GIVEN.
22
YOU WILL NOT HAVE A
I URGE YOU TO PAY CLOSE ATTENTION TO
IF AT ANY TIME YOU CANNOT HEAR OR SEE THE TESTIMONY,
23
EVIDENCE, QUESTIONS OR ARGUMENTS, LET ME KNOW SO THAT I CAN
24
CORRECT THE PROBLEM.
25
IF YOU WISH, YOU MAY TAKE NOTES TO HELP YOU REMEMBER THE
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EVIDENCE.
IF YOU DO TAKE NOTES, PLEASE KEEP THEM TO YOURSELF
UNTIL YOU AND YOUR FELLOW JURORS GO TO THE JURY ROOM TO DECIDE
THE CASE.
DO NOT LET NOTE-TAKING DISTRACT YOU.
WHEN YOU LEAVE, YOUR NOTES SHOULD BE LEFT IN THE JURY
ROOM.
THE CONCLUSION OF THE CASE.
8
9
NO ONE WILL READ YOUR NOTES.
THEY WILL BE DESTROYED AT
WHETHER OR NOT YOU TAKE NOTES, YOU SHOULD RELY ON YOUR OWN
MEMORY OF THE EVIDENCE.
NOTES ARE ONLY TO ASSIST YOUR MEMORY.
10
YOU SHOULD NOT BE OVERLY INFLUENCED BY YOUR NOTES OR THOSE OF
11
YOUR FELLOW JURORS.
12
NUMBER 11.
13
THE PARTIES HAVE AGREED TO CERTAIN FACTS THAT WILL BE READ
14
TO YOU.
15
PROVED.
YOU SHOULD THEREFORE TREAT THESE FACTS AS HAVING BEEN
16
NUMBER 12.
17
A DEPOSITION IS THE SWORN TESTIMONY OF A WITNESS TAKEN
18
BEFORE TRIAL.
19
TRUTH, AND LAWYERS FOR EACH PARTY MAY ASK QUESTIONS.
20
QUESTIONS AND ANSWERS ARE RECORDED.
21
THE WITNESS IS PLACED UNDER OATH TO TELL THE

THE
YOU SHOULD CONSIDER DEPOSITION TESTIMONY, PRESENTED TO YOU
22
IN COURT IN LIEU OF LIVE TESTIMONY, INSOFAR AS POSSIBLE, IN THE
23
SAME WAY AS IF THE WITNESS HAD BEEN PRESENT TO TESTIFY.
24
NUMBER 13.
25
EVIDENCE MAY BE PRESENTED TO YOU IN THE FORM OF ANSWERS OF
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ONE OF THE PARTIES TO WRITTEN INTERROGATORIES SUBMITTED BY THE
OTHER SIDE.
BEFORE THE ACTUAL TRIAL IN RESPONSE TO QUESTIONS THAT WERE
SUBMITTED IN WRITING UNDER ESTABLISHED COURT PROCEDURES.
5
6
THESE ANSWERS WERE GIVEN IN WRITING AND UNDER OATH
YOU SHOULD CONSIDER THE ANSWERS, INSOFAR AS POSSIBLE, IN

THE SAME WAY AS IF THEY WERE MADE FROM THE WITNESS STAND.
14.
SOME WITNESSES, BECAUSE OF EDUCATION OR EXPERIENCE, ARE
9
10
PERMITTED TO STATE OPINIONS AND THE REASONS FOR THOSE OPINIONS.

OPINION TESTIMONY SHOULD BE JUDGED JUST LIKE ANY OTHER
11
TESTIMONY.
YOU MAY ACCEPT IT OR REJECT, AND GIVE IT AS MUCH
12
WEIGHT AS YOU THINK IT DESERVES, CONSIDERING THE WITNESS'S
13
EDUCATION AND EXPERIENCE, THE REASONS GIVEN FOR THE OPINION,
14
AND ALL THE OTHER EVIDENCE IN THE CASE.
15
15.
16
LANGUAGES OTHER THAN ENGLISH MAY BE USED DURING THIS
17
18
TRIAL.
WITNESSES WHO DO NOT SPEAK ENGLISH OR ARE MORE PROFICIENT
19
IN ANOTHER LANGUAGE TESTIFY THROUGH AN OFFICIAL COURT
20
INTERPRETER.
21
IMPORTANT THAT ALL JURORS CONSIDER THE SAME EVIDENCE.
22
THEREFORE, YOU MUST ACCEPT THE INTERPRETER'S TRANSLATION OF THE
23
WITNESS'S TESTIMONY.
ALTHOUGH SOME OF YOU MAY KNOW KOREAN, IT IS
YOU MUST DISREGARD ANY DIFFERENT MEANING.
24
16.
25
YOU MUST NOT MAKE ANY ASSUMPTION ABOUT A WITNESS OR A
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PARTY BASED SOLELY UPON THE USE OF AN INTERPRETER TO ASSIST
THAT WITNESS OR PARTY.
17.
FROM TIME TO TIME DURING THE TRIAL, IT MAY BECOME
NECESSARY FOR ME TO TALK WITH THE ATTORNEYS OUT OF THE HEARING
OF THE JURY, EITHER BY HAVING A CONFERENCE AT THE BENCH WHEN
THE JURY IS PRESENT IN THE COURTROOM, OR BY CALLING A RECESS.
8
9
PLEASE UNDERSTAND THAT WHILE YOU ARE WAITING, WE ARE

WORKING.
THE PURPOSE OF THESE CONFERENCES IS NOT TO KEEP
10
RELEVANT INFORMATION FROM YOU BUT TO DECIDE HOW CERTAIN
11
EVIDENCE IS TO BE TREATED UNDER THE RULES OF EVIDENCE AND TO
12
AVOID CONFUSE AND ERROR.
13
14
15
OF COURSE, WE WILL DO WHAT WE CAN TO KEEP THE NUMBER AND

LENGTH OF THESE CONFERENCES TO A MINIMUM.
I MAY NOT ALWAYS GRANT AN ATTORNEY'S REQUEST FOR A
16
CONFERENCE.
DO NOT CONSIDER MY GRANTING OR DENYING A REQUEST
17
FOR A CONFERENCE AS ANY INDICATION OF MY OPINION OF THE CASE OR
18
OF WHAT YOUR VERDICT SHOULD BE.
19
18.
20
THIS CASE INVOLVES DISPUTES RELATING TO UNITED STATES
21
PATENTS.
BEFORE SUMMARIZING THE POSITIONS OF THE PARTIES AND
22
THE LEGAL ISSUES INVOLVED IN THE DISPUTE, LET ME TAKE A MOMENT
23
TO EXPLAIN WHAT PATENTS ARE AND HOW THEY ARE OBTAINED.
24
PATENTS ARE GRANTED BY THE UNITED STATES PATENT AND
25
TRADEMARK OFFICE (SOMETIMES CALLED "THE PTO.") IN GENERAL
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TERMS, A PATENT PROTECTS THE WAY AN ARTICLE IS USED OR WORKS.
IT ALSO PROTECTS A METHOD OR PROCESS OF MAKING OR DOING
SOMETHING.
A VALID UNITED STATES PATENT GIVES THE PATENT OWNER THE
RIGHT TO PREVENT OTHERS FROM MAKING, USING, OFFERING TO SELL OR
SELLING THE PATENTED INVENTION WITHIN THE UNITED STATES, OR
FROM IMPORTING IT INTO THE UNITED STATES, DURING THE TERM OF
THE PATENT WITHOUT THE PATENT HOLDER'S PERMISSION.
A VIOLATION OF THE PATENT OWNER'S RIGHTS IS CALLED
10
INFRINGEMENT.
THE PATENT OWNER MAY TRY TO ENFORCE A PATENT
11
AGAINST PERSONS BELIEVED TO BE INFRINGERS BY A LAWSUIT FILED IN
12
FEDERAL COURT.
13
A PATENT INCLUDES WHAT IS CALLED A "SPECIFICATION."
14
SPECIFICATION MUST CONTAIN A WRITTEN DESCRIPTION OF THE CLAIMED
15
INVENTION TELLING WHAT THE INVENTION IS, HOW IT WORKS, HOW TO
16
MAKE IT, AND HOW TO USE IT SO OTHERS SKILLED IN THE FIELD WILL
17
KNOW HOW TO MAKE OR USE IT.
18
THE
THE SPECIFICATION CONCLUDES WITH ONE OR MORE NUMBERED
19
SENTENCES.
20
EVENTUALLY GRANTED BY THE PTO, THE CLAIMS DEFINE THE BOUNDARIES
21
OF ITS PROTECTION AND GIVE NOTICE TO THE PUBLIC OF THOSE
22
BOUNDARIES.
23
THESE ARE THE PATENT "CLAIMS ."
WHEN THE PATENT IS
THE PROCESS OF OBTAINING A PATENT IS CALLED PATENT
24
PROSECUTION.
TO OBTAIN A PATENT, ONE MUST FILE AN APPLICATION
25
WITH THE PTO.
THE PTO IS AN AGENCY OF THE FEDERAL GOVERNMENT
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AND EMPLOYS TRAINED EXAMINERS WHO REVIEW APPLICATIONS FOR
PATENTS.
AFTER THE APPLICANT FILES THE APPLICATION, A PTO PATENT
EXAMINER REVIEWS THE PATENT APPLICATION TO DETERMINE WHETHER
THE CLAIMS ARE PATENTABLE AND WHETHER THE SPECIFICATION
ADEQUATELY DESCRIBES THE INVENTION CLAIMED.
IN EXAMINING A PATENT APPLICATION, THE PATENT EXAMINER
REVIEWS RECORDS AVAILABLE TO THE PTO FOR WHAT IS REFERRED TO AS
"PRIOR ART."
10
11
THE EXAMINER ALSO WILL REVIEW PRIOR ART IF IT IS SUBMITTED

TO THE PTO BY AN APPLICANT.
12
PRIOR ART IS DEFINED BY LAW AND I WILL GIVE YOU, AT A
13
LATER TIME, SPECIFIC INSTRUCTIONS AS TO WHAT CONSTITUTES PRIOR
14
ART.
15
HOWEVER, IN GENERAL, PRIOR ART INCLUDES THINGS THAT EXISTS
16
BEFORE THE CLAIMED INVENTION, THAT WERE PUBLICLY KNOWN OR USED
17
IN A PUBLICLY ACCESSIBLE WAY IN THIS COUNTRY, OR THAT WERE
18
PATENTED OR DESCRIBED IN A PUBLICATION IN ANY COUNTRY.
19
THE EXAMINER CONSIDERS, AMONG OTHER THINGS, WHETHER EACH
20
CLAIM DEFINES AN INVENTION THAT IS NEW, USEFUL, AND NOT OBVIOUS
21
IN VIEW OF THE PRIOR ART.
22
THE EXAMINER CONSIDERED; THIS LIST IS CALLED THE "CITED
23
PREFERENCES."
24
25
A PATENT LISTS THE PRIOR ART THAT
AFTER THE PRIOR ART SEARCH AND EXAMINATION OF THE

APPLICATION, THE PATENT EXAMINER THEN INFORMS THE APPLICANT IN
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WRITING WHAT THE EXAMINER HAS FOUND AND WHETHER ANY CLAIM IS
PATENTABLE, AND THUS WILL BE "ALLOWED."
3
4
5
THIS WRITING FROM THE PATENT EXAMINER IS CALLED AN "OFFICE

ACTION."
IF THE EXAMINER REJECTS THE CLAIMS, THE APPLICANT THEN
RESPONDS AND SOMETIMES CHANGES THE CLAIMS OR SUBMITS NEW
CLAIMS.
8
9
THIS PROCESS, WHICH TAKES PLACE ONLY BETWEEN THE EXAMINER

AND THE PATENT APPLICANT, MAY GO BACK AND FORTH FOR SOME TIME
10
UNTIL THE EXAMINER IS SATISFIED THAT THE APPLICATION AND CLAIMS
11
MEET THE REQUIREMENTS FOR A PATENT.
12
THE PAPERS GENERATED DURING THIS TIME OF COMMUNICATING
13
BACK AND FORTH BETWEEN THE PATENT EXAMINER AND THE APPLICANT
14
MAKE UP WHAT IS CALLED THE "PROSECUTION HISTORY."
15
MATERIAL BECOMES AVAILABLE TO THE PUBLIC NO LATER THAN THE DATE
16
WHEN THE PATENT ISSUES.
17
ALL OF THIS
THE FACT THAT THE PTO GRANTS A PATENT DOES NOT NECESSARILY
18
MEAN THAT ANY INVENTION CLAIMED IN THE PATENT, IN FACT,
19
DESERVES THE PROTECTION OF A PATENT.
20
NOT HAVE HAD AVAILABLE TO IT ALL THE INFORMATION THAT WILL BE
21
PRESENTED TO YOU.
22
FOR EXAMPLE, THE PTO MAY
A PERSON ACCUSED OF INFRINGEMENT HAS THE RIGHT TO ARGUE
23
HERE IN FEDERAL COURT THAT A CLAIMED INVENTION IN THE PATENT IS
24
INVALID BECAUSE IT DOES NOT MEET THE REQUIREMENTS FOR A PATENT.
25
19.
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THERE ARE SEVEN PATENTS ASSERTED IN THIS CASE.
APPLE ACCUSES SAMSUNG OF INFRINGING UNITED STATES PATENT
NUMBERS 5,946,647; 6,847,959; 7,761,414; 8,046,172.
PATENTS ARE OFTEN REFERRED TO BY THEIR LAST THREE DIGITS,
SO APPLE'S PATENTS MAY BE REFERRED TO IN SHORTHAND AS THE '647,
'959, '414, '721, AND '172 PATENTS.
7
8
9
10
11
SAMSUNG ACCUSES APPLE OF INFRINGING UNITED STATES PATENT

NUMBERS 6,226,445 AND 5,579,239.
SAMSUNG'S PATENTS MAY BE REFERRED TO IN SHORT HAPPENED AS
THE 449 AND 239 PATENTS.
TO HELP YOU FOLLOW THE EVIDENCE, I WILL NOW GIVE YOU A
12
SUMMARY OF THE POSITIONS OF THE PARTIES WITH RESPECT TO THE
13
PATENT CLAIMS.
14
THE PARTIES IN THIS CASE ARE APPLE, INCORPORATED, WHICH WE
15
WILL REFER TO AS "APPLE" AND SAMSUNG ELECTRONICS COMPANY
16
LIMITED, SAMSUNG ELECTRONICS AMERICA, INCORPORATED, AND SAMSUNG
17
TELECOMMUNICATIONS AMERICA LIMITED LIABILITY CORPORATION, WHICH
18
I WILL REFER TO COLLECTIVELY AS "SAMSUNG" UNLESS I THINK IT IS
19
IMPORTANT TO DISTINGUISH BETWEEN THESE ENTITIES FOR THE
20
PURPOSES OF A SPECIFIC INSTRUCTION.
21
YOU MUST DECIDE THE CASE AS TO SAMSUNG ELECTRONICS
22
COMPANY, SAMSUNG ELECTRONICS AMERICA, AND SAMSUNG
23
TELECOMMUNICATIONS AMERICA SEPARATELY REGARDLESS OF WHETHER I
24
REFER TO THEM COLLECTIVELY AS "SAMSUNG" OR INDIVIDUALLY.
25
THE CASE INVOLVES FIVE UNITED STATES PATENTS OWNED BY
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2
APPLE AND TWO UNITED STATES PATENTS OWNED BY SAMSUNG.

APPLE FILED THIS LAWSUIT AGAINST SAMSUNG SEEKING MONEY
DAMAGES FROM SAMSUNG FOR ALLEGEDLY INFRINGING THE '647, '959,
'414, '721, AND '172 PATENTS BY MAKING, IMPORTING, USING,
SELLING, AND/OR OFFERING FOR SALE THE TABLET AND SMARTPHONE
PRODUCTS THAT APPLE ARGUES ARE COVERED CLAIM 9 OF THE '647
PATENT, CLAIM 25 OF THE '959 PATENT, CLAIM 20 OF THE '414
PATENT, CLAIM 8 OF THE '721 PATENT, AND CLAIM 18 OF THE '172
PATENT.
10
APPLE ALSO ARGUES THAT SAMSUNG ELECTRONICS COMPANY
11
ACTIVELY INDUCED SAMSUNG ELECTRONICS AMERICA, INC. AND SAMSUNG
12
TELECOMMUNICATIONS AMERICA LLC TO INFRINGE.
13
14
15
APPLE CONTENDS THAT SAMSUNG'S INFRINGEMENT HAS BEEN

WILLFUL.
SAMSUNG DENIES THAT IT HAS INFRINGED THE ASSERTED CLAIMS
16
OF THE '647, '959, '414, AND '721 PATENTS AND ARGUES THAT, IN
17
ADDITION, THE ASSERTED CLAIMS ARE INVALID.
18
DEFENSE TO INFRINGEMENT.
19
INVALIDITY IS A
YOUR DUTY FOR APPLE'S '172 PATENT IS DIFFERENT FROM THE
20
OTHER PATENTS.
THE COURT HAS ALREADY FOUND THAT THE ADMIRE,
21
GALAXY NEXUS, GALAXY NOTE (EXCLUDING ONE RELEASE), GALAXY SII
22
(EXCLUDING ONE RELEASE), GALAXY SII EPIC 4G TOUCH (EXCLUDING
23
ONE RELEASE), GALAXY SII SKYROCKET (EXCLUDING ONE RELEASE), AND
24
STRATOSPHERE INFRINGE CLAIM 18 OF THE '172 PATENT.
25
ONLY DETERMINE WHETHER CLAIM 18 IS INVALID.
YOU NEED
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SAMSUNG HAS ALSO BROUGHT CLAIMS AGAINST APPLE FOR PATENT
INFRINGEMENT.
ALLEGEDLY INFRINGING THE '449 AND '239 PATENTS BY MAKING,
IMPORTING, USING, SELLING AND/OR OFFERING FOR SALE APPLE'S, 1,
CERTAIN IPHONE AND IPOD TOUCH PRODUCTS THAT SAMSUNG ARGUES ARE
COVERED BY CLAIM 27 OF THE '449 PATENT; AND, NUMBER 2, CERTAIN
IPHONE AND IPAD PRODUCTS THAT SAMSUNG ARGUES ARE COVERED BY
CLAIM 15 OF THE '239 PATENT.
9
10
11
SAMSUNG SEEKS MONEY DAMAGES FROM APPLE FOR
SAMSUNG ALSO CONTENDS THAT APPLE'S INFRINGEMENT HAS BEEN

WILLFUL.
APPLE DENIES THAT IT HAS INFRINGED THE CLAIMS ASSERTED BY
12
SAMSUNG.
APPLE DOES NOT ARGUE THAT SAMSUNG'S PATENTS ARE
13
INVALID.
THEREFORE, YOU NEED ONLY DETERMINE WHETHER THE '449
14
AND THE '239 PATENTS ARE INFRINGED AND WHETHER THAT
15
INFRINGEMENT HAS BEEN WILLFUL.
16
IN THIS CASE, APPLE DOES NOT CONTEND THAT IT PRACTICES THE
17
'414, '172 OR '959 PATENTS, AND SAMSUNG DOES NOT CONTEND THAT
18
IT PRACTICES THE '449 PATENT.
19
FOR EACH PARTY'S PATENT INFRINGEMENT CLAIMS AGAINST THE
20
OTHER, THE FIRST ISSUE YOU WILL BE ASKED TO DECIDE IS WHETHER
21
THE ALLEGED INFRINGER HAS INFRINGED THE CLAIMS OF THE PATENT
22
HOLDER'S PATENTS.
23
TO DECIDE WHETHER THOSE PATENTS ARE VALID.
24
25
FOR APPLE'S PATENTS, YOU WILL ALSO BE ASKED
IF YOU DECIDE THAT ANY CLAIM OF EITHER PARTY'S PATENTS HAS

BEEN INFRINGED AND, FOR APPLE'S PATENTS, IS NOT INVALID, YOU
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WILL THEN NEED TO DECIDE ANY MONEY DAMAGES TO BE AWARDED TO THE
PATENT HOLDER TO COMPENSATE IT FOR THE INFRINGEMENT.
3
4
5
YOU WILL ALSO NEED TO MAKE A FINDING AS TO WHETHER THE

INFRINGEMENT WAS WILLFUL.
IF YOU DECIDE THAT ANY INFRINGEMENT WAS WILLFUL, THAT
DECISION SHOULD NOT AFFECT ANY DAMAGE AWARD YOU GIVE.
TAKE WILLFULNESS INTO ACCOUNT LATER.
8
9
I WILL
BEFORE YOU DECIDE WHETHER EITHER PARTY HAS INFRINGED THE

OTHER'S PATENTS, OR WHETHER APPLE'S PATENTS ARE INVALID, YOU
10
WILL NEED TO UNDERSTAND THE PATENT CLAIMS.
11
PATENT CLAIMS ARE NUMBERED SENTENCES AT THE END OF THE PATENT
12
THAT DESCRIBE THE BOUNDARIES OF THE PATENT'S PROTECTION.
13
14
15
AS I MENTIONED, THE
IT IS MY JOB AS JUDGE TO EXPLAIN TO YOU THE MEANING OF ANY

LANGUAGE IN THE CLAIMS THAT NEEDS INTERPRETER.
I HAVE ALREADY DETERMINED THE MEANING OF CERTAIN TERMS OF
16
THE CLAIMS OF SOME OF THE PATENTS AT ISSUE.
17
TO APPLY MY DEFINITIONS OF THESE TERMS IN THIS CASE.
18
YOU WILL BE ASKED
HOWEVER, MY INTERPRETATION OF THE LANGUAGE OF THE CLAIMS
19
SHOULD NOT BE TAKEN AS AN INDICATION THAT I HAVE A VIEW
20
REGARDING ISSUES, SUCH AS INFRINGEMENT (EXCEPT FOR APPLE'S '172
21
PATENT) AND INVALIDITY.
22
THOSE ISSUES ARE YOURS TO DECIDE.
I WILL PROVIDE YOU WITH MORE DETAILED INSTRUCTIONS ON THE
23
MEANING OF THE CLAIMS BEFORE YOU RETIRE TO DELIBERATE YOUR
24
VERDICT.
25
FINAL INSTRUCTION.
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THE TRIAL WILL NOW BEGIN.
FIRST, EACH SIDE MAY MAKE AN
OPENING STATEMENT.
IS SIMPLY AN OUTLINE TO HELP YOU UNDERSTAND WHAT THAT PARTY
EXPECTS THE EVIDENCE WILL SHOW.
AN OPENING STATEMENT IS NOT EVIDENCE.
THE PRESENTATION OF EVIDENCE WILL THEN BEGIN.
IT
WITNESSES
WILL TAKE THE WITNESS STAND AND THE DOCUMENTS WILL BE OFFERED
AND ADMITTED INTO EVIDENCE.
8
9
THERE ARE TWO STANDARDS OF PROOF THAT YOU WILL APPLY TO

THE EVIDENCE, DEPENDING ON THE ISSUE YOU ARE DECIDING.
ON SOME
10
ISSUES, YOU MUST DECIDE WHETHER SOMETHING IS MORE LIKELY TRUE
11
THAN NOT.
12
DECIDE WHETHER IT IS HIGHLY PROBABLE THAT SOMETHING IS TRUE.
13
ON OTHER ISSUES, YOU MUST USE A HIGHER STANDARD AND
APPLE WILL START BY PRESENTING ITS EVIDENCE ON ITS
14
CONTENTIONS THAT SAMSUNG HAS INFRINGED APPLE'S PATENTS.
15
WILL ALSO PRESENT ITS EVIDENCE THAT SAMSUNG'S INFRINGEMENT HAS
16
BEEN WILLFUL.
17
18
19
20
21
APPLE
THESE WITNESSES WILL BE QUESTIONED BY APPLE'S COUNSEL IN

WHAT IS CALLED DIRECT EXAMINATION.
AFTER THE DIRECT EXAMINATION OF A WITNESS IS COMPLETED,
SAMSUNG HAS AN OPPORTUNITY TO CROSS-EXAMINE THE WITNESS.
TO PROVE INFRINGEMENT OF ANY CLAIM, APPLE MUST PERSUADE
22
YOU THAT IT IS MORE LIKELY THAN NOT THAT SAMSUNG HAS INFRINGED
23
APPLE'S PATENTS.
24
25
AFTER APPLE HAS PRESENTED ITS WITNESSES, SAMSUNG WILL CALL

ITS WITNESSES, WHO WILL ALSO BE EXAMINED AND CROSS-EXAMINED.
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SAMSUNG WILL PRESENT ITS EVIDENCE ON ITS CONTENTIONS THAT APPLE
HAS INFRINGED SAMSUNG'S PATENTS.
3
4
5
SAMSUNG WILL ALSO PRESENT ITS EVIDENCE THAT APPLE'S

INFRINGEMENT HAS BEEN WILLFUL.
TO PROVE INFRINGEMENT OF ANY CLAIM, SAMSUNG MUST PERSUADE
YOU THAT IT IS MORE LIKELY THAN NOT THAT APPLE HAS INFRINGED
SAMSUNG'S PATENTS.
8
9
SAMSUNG WILL ALSO PRESENT ITS EVIDENCE THAT ASSERTED

CLAIMS OF APPLE'S PATENTS ARE NOT INFRINGED AND ARE INVALID.
10
TO PROVE INVALIDITY OF ANY CLAIM, SAMSUNG MUST PERSUADE YOU
11
THAT IT IS HIGHLY PROBABLE THAT THE CLAIM IS INVALID.
12
APPLE WILL THEN RETURN AND WILL PUT ON EVIDENCE RESPONDING
13
TO SAMSUNG'S CONTENTION THAT THE APPLE PATENTS ARE INVALID.
14
APPLE WILL THEN PRESENT ITS EVIDENCE THAT ASSERTED CLAIMS OF
15
SAMSUNG'S PATENTS ARE NOT INFRINGED.
16
BECAUSE THE EVIDENCE IS INTRODUCED PIECEMEAL, YOU MAY NEED
17
TO KEEP AN OPEN MIND AS THE EVIDENCE COMES IN AND WAIT FOR ALL
18
THE EVIDENCE BEFORE YOU MAKE ANY DECISIONS.
19
YOU SHOULD KEEP AN OPEN MIND THROUGHOUT THE ENTIRE TRIAL.
20
IN OTHER WORDS,
AFTER THE EVIDENCE HAS BEEN PRESENTED, I WILL GIVE YOU
21
FINAL INSTRUCTIONS ON THE LAW THAT APPLIES TO THE CASE, AND THE
22
ATTORNEYS WILL MAKE CLOSING ARGUMENTS.
23
NOT EVIDENCE.
24
25
CLOSING ARGUMENTS ARE
AFTER THE INSTRUCTIONS AND CLOSING ARGUMENTS, YOU WILL

THEN DECIDE THE CASE.
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PLAINTIFF'S
OPENING Document
STATEMENT
1
WOULD EVERYONE JUST LIKE A MINUTE TO JUST STAND UP.
WHY
DON'T WE ALL JUST TAKE A STAND UP MOMENT BEFORE THE LIGHTS GO
OFF FOR THE VIDEO.
THE COURT:
WE'RE NOW GOING TO WATCH A VIDEO.
ABOUT 17 MINUTES.
WOULD DIM THE LIGHTS, PLEASE.
10
I'M GOING TO ASK MS. PARKER BROWN IF YOU
(A VIDEOTAPE WAS PLAYED IN OPEN COURT OFF THE RECORD.)
8
9
IT'S
THE COURT:
STATEMENTS.
ALL RIGHT.
WE ARE NOW READY FOR OPENING
EACH SIDE MAY MAKE ONE, BUT THEY'RE NOT REQUIRED
TO DO SO.
11
I REMIND YOU THAT AN OPENING STATEMENT IS NOT EVIDENCE.
12
WE ARE GOING TO KEEP OUR REGULAR SCHEDULE OF TAKING A
13
BREAK AT 10:30 FOR AT LEAST 15 MINUTES.
14
LUNCH BREAK FROM NOON TO 1:00 AND HAVE OUR REGULAR AFTERNOON
15
BREAKS.
16
17
18
19
20
21
OKAY?
ALL RIGHT.
GO AHEAD, PLEASE.
MR. MCELHINNY:
THANK YOU, YOUR HONOR.
PLAINTIFF.)
MR. MCELHINNY:
MAY IT PLEASE THE COURT.
GOOD MORNING.
JURORS:
23
MR. MCELHINNY:
25
TIME IS NOW 10:00 O'CLOCK.
(MR. MCELHINNY GAVE HIS OPENING STATEMENT ON BEHALF OF
22
24
WE'LL STILL TAKE OUR
GOOD MORNING.
WHERE WERE YOU ON JANUARY 9TH, 2007?
THERE ARE A LOT OF PROBLEMS WITH LAWSUITS, AND I THINK BY

THE TIME WE'RE DONE, YOU'LL HAVE YOUR OWN LITTLE LIST OF ALL
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PLAINTIFF'S
OPENING Document
STATEMENT
1
2
THE PROBLEMS WITH LAWSUITS AND IMPORTANT TRIALS.

BUT ONE OF THEM THAT I WANT TO ILLUSTRATE FOR YOU IS THAT
IT TAKES A WHILE TO GET TO COURT.
DISPUTE TO A JURY LIKE YOU, AND DURING THAT TIME, TIME PASSES
AND LIFE CHANGES AND THINGS THAT WERE NEW BEFORE NOW SEEM
COMMON.
IT TAKES A WHILE TO BRING A
AND SO ONE OF THE TESTS HERE, ONE OF THE THINGS THAT YOU
SORT OF HAVE TO DO IS PUT YOURSELF BACK IN TIME WHEN THESE
EVENTS OCCURRED AND REMEMBER WHAT LIFE WAS LIKE THEN.
10
11
12
SO THAT'S WHY I STARTED WITH THAT QUESTION.
WHERE WERE
YOU ON JANUARY 9TH, 2007?

WE KNOW THAT ON THAT DATE HUNDREDS OF PEOPLE IN THE BAY
13
AREA WERE IN THE MOSCONE CONVENTION CENTER IN SAN FRANCISCO AT
14
THE MACWORLD CONVENTION BECAUSE THAT IS THE DATE THAT THE
15
IPHONE WAS INTRODUCED.
16
17
18
19
AND WE KNOW THAT BECAUSE WE HAVE A VIDEOTAPE OF THAT

PRESENTATION WHICH I WOULD LIKE TO SHOW YOU.
MR. MCELHINNY:
MY NAME IS HAROLD MCELHINNY.
YOU MET
20
MY GOOD FRIEND, BILL LEE, YESTERDAY.
21
SELWYN AND MY PARTNER, RACHEL KREVANS, AND OTHER MEMBERS OF OUR
22
TEAM, IT IS OUR PRIVILEGE AND HONOR TO BE REPRESENTING APPLE IN
23
THIS LITIGATION AGAINST SAMSUNG ELECTRONICS AND ITS
24
SUBSIDIARIES.
25
AND ALONG WITH MARK
IT IS OUR JOB TO BRING YOU THE EVIDENCE THAT YOU'RE GOING
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PLAINTIFF'S
OPENING Document
STATEMENT
1
TO NEED IN ORDER TO DO YOUR JOB, WHICH IS TO DECIDE THE ISSUES
THAT JUDGE KOH WILL GIVE YOU AT THE END OF THIS CASE.
WHILE I'M MAKING INTRODUCTIONS, I WOULD LIKE TO INTRODUCE
TWO OTHER PEOPLE TO YOU.
WHO'S THE GENERAL COUNSEL OF APPLE, AND NOREEN KRALL, WHO'S THE
VICE-PRESIDENT AND IN CHARGE OF LITIGATION FOR APPLE.
NOREEN IS MY BOSS.
8
9
10
IN THE AUDIENCE WE HAVE BRUCE SEWELL,
AND
ON BEHALF OF ALL OF APPLE'S EMPLOYEES, WE WOULD LIKE TO

THANK YOU FOR SERVING ON THIS JURY.
ALMOST SEVEN YEARS AGO, THE INTRODUCTION OF THE IPHONE
11
LITERALLY CHANGED THE NATURE OF THE TELEPHONE.
12
APPLE INVENTED A WAY TO PUT THE COMPUTING POWER OF A MAC
13
COMPUTER ON A HANDHELD COMMUNICATIONS DEVICE.
14
15
16
THE PEOPLE AT
THEY ALSO MOVED THE WORLD FROM A PHYSICAL KEYBOARD TO

TAPPING ON AN INTERACTIVE GLASS FACE.
THOSE WERE TWO DRAMATIC CHANGES THAT HAPPENED AT THAT
17
MOMENT, AND THAT'S WHY TODAY, WHEN EVERYBODY DOESN'T --
18
SOMEBODY THE OTHER DAY JUST SAID TO ME, DO YOU REMEMBER WHEN
19
PEOPLE USED TO TALK ON TELEPHONES?
20
USED TO HAVE THOSE BIG BACK TELEPHONES?
21
THERE USED TO BE PAY TELEPHONE BOOTHS ON EVERY CORNER?
22
23
24
25
DO YOU REMEMBER WHEN THEY

DO YOU REMEMBER WHEN
THAT WORLD IS GONE, AND IT CHANGED ON THAT DAY IN JANUARY

OF 2007.
YOU DON'T NEED TO TAKE MY WORD FOR THE EFFECT THAT THE
IPHONE HAD.
DURING THIS TRIAL, YOU'LL SEE A NUMBER OF
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CONTEMPORANEOUS ARTICLES AND REVIEWS THAT WILL REMIND YOU OF
THOSE EFFECTS.
SO, FOR EXAMPLE, YOU WILL SEE PLAINTIFF'S EXHIBIT 135A.
WE WILL USE SOME TERMINOLOGY, PLAINTIFF'S EXHIBIT, YOU CAN SEE
THAT THE LOWER RIGHT-HAND CORNER, IT SAYS PDX, PLAINTIFF'S
EXHIBIT 135A, AS WE REFER TO THOSE, IF YOU WANT TO TAKE NOTES,
YOU WILL HAVE THESE IN THE JURY ROOM WHEN YOU'RE DONE.
THIS EXHIBIT WAS AN ARTICLE THAT APPEARED IN THE
"NEW YORK TIMES" THE DAY AFTER THE ANNOUNCEMENT.
IT WAS
10
WRITTEN BY A GENTLEMAN BY THE NAME OF DAVID POGUE, WHO IS A
11
WELL-KNOWN TECHNOLOGY REPORTER.
12
AND AMONG OTHER THINGS HE SAID IN THE ARTICLE, HE SAID
13
"THIS MACHINE IS SO PACKED WITH POSSIBILITIES THAT THE CELL
14
PHONE MAY ACTUALLY BE THE LEAST INTERESTING PART."
15
YOU WILL SEE THIS DOCUMENT, WHICH IS PX 133.
IN 2007,
16
"TIME MAGAZINE" NAMED THE IPHONE THE TIME BEST INVENTIONS OF
17
2007.
18
19
20
ON THE COVER, IT SAID, "FROM THE PHONE THAT HAS CHANGED

PHONES FOREVER."
AND AS WE NOW KNOW, THAT TURNED OUT TO BE PROPHETICALLY
21
CORRECT.
22
PRODUCT ITSELF ON THE COVER OF "TIME MAGAZINE" AND SPELLED OUT
23
"BEST INVENTIONS" USING APPLE'S NEW ICONIC ICONS.
24
25
IT ACTUALLY SPELLED OUT, THEY PUT THE COVER, THE
THE ARTICLE ITSELF SAID THAT THE PHONE WAS TOUCHY FEELY.
IT WAS A TOUCHSCREEN DEVICE.
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IT SAID, "APPLE'S ENGINEERS USED THE TOUCHSCREEN TO
INNOVATE PAST THE GRAPHICAL USER INTERFACE (WHICH APPLE HELPED
PIONEER WITH MACINTOSH IN THE 1980S) TO CREATE A WHOLE NEW KIND
OF INTERFACE."
5
6
7
8
9
AND, FINALLY, IT SAID "THIS IS, AS ENGINEERS SAY,

NONTRIVIAL."
THAT LAST QUOTE I HOPE YOU WILL FIND, AS I DO, THAT IT'S
PARTICULARLY IMPORTANT AND RELEVANT.
IN THIS CASE, SAMSUNG'S LAWYERS AND WITNESSES WILL TRY TO
10
TELL YOU EXACTLY THE OPPOSITE.
THEY WILL TRY TO TELL YOU THAT
11
OUR INVENTIONS ARE AND WERE TRIVIAL AND THAT THEY ARE NOT
12
VALUABLE.
13
BUT THAT'S NOT WHAT THE WORLD WAS SAYING IN 2007.
14
YOU WILL ALSO SEE THIS ARTICLE, WHICH IS PLAINTIFF'S
15
EXHIBIT 134.
16
ARTICLE FROM THE "NEW YORK TIMES" REPORTING THAT THE U.S.
17
PATENT AND TRADEMARK OFFICE, THE OFFICE THAT YOU JUST HEARD
18
ABOUT THAT ISSUES PATENTS, PUT TOGETHER A DISPLAY FOR THE
19
PUBLIC TO EXPLAIN PART OF ITS WORK, AND IT PUT TOGETHER A
20
DISPLAY BASED ON THE INVENTIONS OF STEVE JOBS.
21
THIS IS SEVERAL YEARS LATER IN 2011.
HERE IS AN
AND IN THIS ARTICLE BY MR. BRIAN CHEN, A FAMOUS REPORTER
22
FOR THE "NEW YORK TIMES," IT SAID "PATENTS ON TECHNOLOGICAL
23
DEVICES DO NOT ALWAYS RESULT IN REAL PRODUCTS THAT HIT THE
24
CONSUMER MARKET, BUT THEY DOCUMENT AN INVENTOR'S RESEARCH AND
25
METHODOLOGY IN DIFFERENT AREAS OF DESIGN AND ENGINEERING."
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THAT'S HOW THE WORLD HAS REACTED TO THIS INVENTION.
BUT AT THE SAME TIME, AT THIS SAME KEYNOTE ADDRESS WHEN
MR. JOBS INTRODUCED THE IPHONE, HE ALSO WARNED APPLE'S
COMPETITORS THAT APPLE HAD APPLIED FOR PATENT PROTECTION TO
PROTECT THE MANY INVENTIONS THAT HAD BEEN DEVELOPED AS PART OF
THE IPHONE PROJECT.
YOU WILL HEAR EVIDENCE FROM PEOPLE WHO WERE THERE DURING
THIS TRIAL, THAT THE IPHONE WAS THE RESULT OF A THREE YEAR, TOP
SECRET RESEARCH AND DEVELOPMENT PROJECT THAT HAPPENED AT APPLE,
10
THOUSANDS AND THOUSANDS OF PEOPLE -- OF ENGINEERING HOURS THAT
11
WENT INTO THE DEVELOPMENT OF THIS PROGRAM.
12
YOU WILL ALSO HEAR -- AND, FRANKLY, AGAIN, TIME CHANGES
13
EVERYTHING.
14
YOU WILL HEAR THAT AT THE TIME, IN 1974 WHEN THIS PROJECT
15
STARTED, IT WAS CONSIDERED AN EXTRAORDINARILY RISKY PROJECT.
16
SEVERAL YEARS BEFORE THEN, APPLE AS A COMPANY HAD ALMOST GONE
17
OUT OF BUSINESS.
18
19
20
THIS -- THIS MAY SEEM INCONCEIVABLE TO YOU, BUT
AND YET, THEY WERE GOING TO TAKE ON THIS CHALLENGE OF A

PHONE.
IN 2004, APPLE WAS A COMPUTER COMPANY.
IT HAD NO PHONE
21
EXPERIENCE.
22
WITH A PRODUCT TO COMPETE AGAINST SOME OF THE LARGEST COMPANIES
23
IN THE WORLD:
24
ESTABLISHED IN THE PHONE BUSINESS.
25
AND IT WAS GOING TO INVEST THIS TIME TO COME UP
MOTOROLA, NOKIA, SAMSUNG.
THEY WERE ALL
BUT APPLE, FRESH FROM THIS NEAR DEATH EXPERIENCE, WAS
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PUTTING ITS TIME AND ITS MONEY AND ITS INVESTMENT AND ITS
PEOPLE TO WORK ON A PHONE TO COMPETE IN THIS MARKET.
SO APPLE WAS NOT WILLING TO GIVE AWAY ITS INVENTIONS TO
ITS COMPETITORS.
THEM.
IT SOUGHT AND IT OBTAINED PATENTS TO PROTECT
THIS CASE IS ABOUT FIVE OF THE PATENTS THAT APPLE WAS
AWARDED IN CONNECTION WITH THAT PROJECT AND WORK THAT WAS DONE
AT APPLE.
THE FIRST IS THE '721 PATENT.
YOU SAW PICTURES OF IT IN
10
THE MOVIE.
11
ISSUED BY THE PATENT AND TRADEMARK OFFICE.
12
PRINTING, THE COVER, THE GOLD SEAL.
13
ROOM YOU'LL ONLY HAVE A COPY OF THIS BECAUSE THIS IS THE
14
ORIGINAL, BUT THIS IS WHAT A PATENT LOOKS LIKE (INDICATING).
15
THIS IS WHAT A PATENT ACTUALLY LOOKS LIKE WHEN IT'S
UNFORTUNATELY, IN YOUR
THIS PATENT, WHICH YOU'LL SEE WE'VE BLOWN UP, WAS APPLIED
16
FOR IN 2009.
17
IT DIDN'T ISSUE UNTIL OCTOBER 2011.
18
YOU SAW THE
BUT, AGAIN, GIVEN THE DELAY IN THE PATENT OFFICE,
SO I WANT TO TALK ABOUT THIS PATENT, BUT BEFORE I DO, I
19
WANT TO REPEAT SOMETHING THAT YOU'VE NOW HEARD TWICE AND SO
20
INDULGE ME, PLEASE, ONCE SO THAT YOU HAVE THIS ONCE AND THEN WE
21
WON'T HAVE TO TALK ABOUT IT AGAIN, BUT THAT'S HOW TO READ A
22
PATENT.
23
YOU WANT TO LOOK AT IT.
24
25
YOU HAVE A COPY OF THIS PATENT ALSO IN YOUR BINDER IF

YOU DON'T HAVE TO.
I HAVE THE SLIDES.
MUCH OF THE BASIC INFORMATION THAT'S IMPORTANT ABOUT A

PATENT IS ON THE FIRST PAGE.
THAT INCLUDES THE PATENT NUMBER,
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2
3
4
WHICH IN THIS CASE IS 8,046,721.

AS YOU HEARD, WE DON'T SAY THE WHOLE NUMBER.
WE SAY WE'LL
CALL THIS THE '721 PATENT.

THE FIRST PAGE ALSO CONTAINS THE FORMAL NAME OF THE
PATENT, AND IN THIS CASE, THAT IS "UNLOCKING A DEVICE BY
PERFORMING GESTURES ON AN UNLOCK IMAGE."
IT CONTAINS THE NAMES OF THE INVENTORS AND THE COMPANY
THAT OWNS THE PATENT, AND IN THIS CASE THAT, OF COURSE, IS
APPLE.
10
AND THEN FINALLY -- NOT FINALLY, BUT IT ALSO CONTAINS THE
11
DATE ON WHICH IT WAS ISSUED, IN THIS CASE OCTOBER 25TH, 2011.
12
AND ALSO ON THE FRONT PAGE YOU'LL FIND SOMETHING CALLED
13
14
THE ABSTRACT, WHICH IS A SUMMARY OF THE INVENTION.

THE FIRST PAGE OF THE PATENT AND THE REMAINING PAGES UP TO
15
THE END ARE FREQUENTLY CALLED THE SPECIFICATION.
16
INCLUDE PICTURES WHICH LAWYERS CALL FIGURES.
17
SEE THEM NUMBERED, FIGURE 1, FIGURE 2, FIGURE 3.
18
19
20
AND THEY
THAT'S WHY YOU'LL
AND THEN THERE ARE PAGES OF TEXT THAT EXPLAIN THE

INVENTION IN DETAIL.
AND THEN FINALLY, EACH PATENT CONTAINS WHAT IS CALLED THE
21
CLAIMS.
THE CLAIMS COME AT THE END OF THE PATENT, AND EACH
22
CLAIM IS AN ATTEMPT TO CAPTURE IN WORDS THE IDEA OF THE
23
INVENTION THAT THE INVENTOR IS CLAIMING IN HIS PATENT.
24
THEY ARE, LIKE YOU'VE NOW HEARD THREE TIMES, THEY GIVE YOU THE
25
BOUNDARIES OF THE CLAIM.
AND
THEY'RE LIKE THE WORDS THAT YOU USE
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IN A DEED TO EXPLAIN THE PROPERTY LINES.
TO TAKE AN IDEA AND CAPTURE IT IN WORDS SO THAT PEOPLE
UNDERSTAND WHAT IS YOUR PROPERTY.
BUT IT'S THIS ATTEMPT
TO MAKE IT EVEN TOUGHER, BECAUSE IT IS A CHALLENGE,
PATENTS DON'T HAVE PAGE NUMBERS.
AND SO WHEN YOU LOOK AT THE TEXT OF THE PATENT, YOU'LL SEE
COLUMN NUMBERS.
THE TOP OF EACH COLUMN THERE WILL BE A COLUMN NUMBER.
9
10
11
INSTEAD, THEY HAVE COLUMNS.
EACH PAGE IS DIVIDED INTO TWO COLUMNS.
AND THEN THEY HAVE LINES.
AND AT
AND RUNNING DOWN THE MIDDLE OF
THE PAGE THERE ARE REFERENCES FOR LINE NUMBERS.

SO IF YOU WANT TO REFER SOMEBODY -- AND THIS'LL HAPPEN TO
12
YOU IN THIS CASE -- IF WE SAY WE WANT YOU TO SEE WHAT WAS
13
WRITTEN, WE'LL SAY LOOK AT COLUMN WHATEVER AT LINES SO AND SO,
14
SO YOU GO TO THE COLUMN, THE TOP OF THE PAGE, RUN DOWN THAT
15
INDEX IN THE MIDDLE AND FIND THE LINES THAT YOU'RE LOOKING FOR,
16
AND THAT'S THE WAY THAT YOU REFERENCE A PATENT.
17
IN THE '721 PATENT, THE CLAIMS START AT COLUMN 19, LINE
18
22, AND THEY START WITH ONE OF THE PHRASES THAT'S TYPICAL IN
19
PATENTS, IT SAYS AFTER -- "WHAT IS CLAIMED IS."
20
SO WE'VE GIVEN YOU THE DESCRIPTION.
21
WE'RE NOW DOWN TO THE
END, AND IT SAYS THIS IS WHERE THE CLAIMS START FROM HERE ON.
22
AND AS YOU HEARD FROM JUDGE KOH, IN THIS CASE WE ARE
23
ASSERTING CLAIM 8 OF THE '721 PATENT, AND AS YOU WILL SEE, THIS
24
IS A KIND OF PATENT -- CLAIM 8 IS WHAT -- WE HAVE TWO KINDS OF
25
CLAIMS.
WE HAVE A CLAIM THAT'S CALLED AN INDEPENDENT CLAIM,
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WHICH MEANS IT JUST STANDS ON ITS OWN, AND WE HAVE A CLAIM
THAT'S CALLED A DEPENDENT CLAIM.
REQUIRES YOU TO LOOK AT SOME OTHER CLAIM TO PUT IT ALL
TOGETHER.
AND A DEPENDENT CLAIM
SO IF YOU LOOK AT THE LANGUAGE OF CLAIM 8 THAT STARTS WITH
ANOTHER ONE OF THESE MAGIC PHRASES, IT SAYS "THE DEVICE OF
CLAIM 7 FURTHER COMPRISING INSTRUCTIONS."
8
9
10
11
SO THAT TELLS YOU THAT IN ORDER TO UNDERSTAND WHAT IS IN

CLAIM 8, YOU READ EVERYTHING THAT IS IN CLAIM 7 AND YOU INCLUDE
CLAIM 8.
SO IT'S A, IT'S A DIFFERENT WAY OF EXPRESSING THE
12
INVENTION.
13
CALL A LIMITATION IN ORDER TO EXPLAIN IT IN GREATER DETAIL.
14
15
CLAIM 7 IS ONE WAY, CLAIM 8 ADDS ANOTHER WHAT WE
BUT THE BOUNDARIES OF CLAIM 8 INCLUDE ALL OF THE LANGUAGE

IN CLAIM 7 AND THE EXTRA LANGUAGE IN CLAIM 8.
16
WE CALL THE '721 PATENT THE SLIDE TO UNLOCK PATENT.
17
THAT'S OUR NAME FOR IT INSTEAD OF THE FORMAL NAME THAT I SHOWED
18
YOU BEFORE.
19
THIS PATENT RESPONDED TO PROBLEMS THAT WE'RE ALL FAMILIAR
20
WITH CALLED POCKET DIALLING.
21
IF YOU WOULD PUT THEM IN YOUR POCKET, EVERY ONCE IN A WHILE YOU
22
WOULD END UP CALLING SOMEBODY OR SOMEBODY WOULD CALL YOU OR
23
THERE WOULD BE A PROBLEM, AND IT WAS AN UNINTENDED CALL.
24
25
OLD CELL PHONES THAT HAD BUTTONS,
I'VE HAD A NUMBER OF THOSE WHERE I COULD LISTEN TO MY

GRANDCHILDREN BECAUSE THEY WERE PLAYING WITH THE PHONE, AND I'M
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LISTENING AND THEY DON'T KNOW THAT I'M ON IT.
UNINTENDED CALL.
IT'S AN
THERE WAS A CONCERN THAT ON A TOUCHSCREEN PHONE, THESE
UNINTENDED CALLS WOULD BE MORE COMMON BECAUSE YOU DIDN'T EVEN
HAVE TO HIT BUTTONS.
AFRAID YOU COULD SEND E-MAILS, YOU COULD DELETE THINGS.
WERE CONCERNED ABOUT THAT SO THEY WANTED A MECHANISM THAT WOULD
MAKE IT POSSIBLE TO LOCK THE PHONE AND THEN TO UNLOCK THE
DEVICE, LIKE A SMARTPHONE, BY CONTINUOUSLY MOVING AN UNLOCKED
10
YOU JUST TOUCH THE SCREEN -- THEY WERE

PEOPLE
IMAGE FROM ONE PREDEFINED LOCATION TO ANOTHER.
11
THE DEVICE ALSO DISPLAYS VISUAL CUES -- THIS IS ALL PART
12
OF THE CLAIMS -- TO SHOW YOU HOW TO MOVE THE UNLOCKED IMAGE IN
13
ORDER TO UNLOCK THE DEVICE.
14
15
16
THE DEVICE WAS -- THE INVENTION WAS IMPORTANT FOR TWO

REASONS:
ONE, IT SOLVED THIS PROBLEM OF UNINTENDED USES.
BUT IT DID IT IN A PARTICULARLY ATTRACTIVE WAY.
THE
17
UNLOCKING DEVICE, IF YOU THINK ABOUT IT, IS THE FIRST WAY YOU
18
EVER APPROACH ONE OF THESE DEVICES.
19
DO ON THE PHONE.
20
IT'S THE FIRST THING YOU
AND THE APPLE UNLOCKING DEVICE ATTRACTED PEOPLE'S
21
ATTENTION, ATTRACTED PEOPLE'S INTEREST.
22
THAT TALK ABOUT THE SLIDE BEING FUN AND WHIMSICAL.
23
APPLE INTRODUCED THIS NEW PROJECT TO THE WORLD.
24
25
YOU'LL SEE REVIEWS

IT WAS HOW
THIS PARTICULAR INVENTION WAS SO SIGNIFICANT THAT MR. JOBS

ACTUALLY DEMONSTRATED IT AT THE ORIGINAL KEYNOTE, AND I'LL SHOW
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YOU THAT.
MR. MCELHINNY:
ANYBODY WHO HAS SEEN AN APPLE DEVICE
IS FAMILIAR WITH THAT WAY OF UNLOCKING IT.
IT'S BECOME A
SIGNATURE MOVEMENT FOR APPLE AND ITS PHONES AND PRODUCTS.
THE SECOND PATENT THAT WE'RE ASSERTING IS A PATENT CALLED
THE '172 PATENT, AND WE CALL THAT THE AUTOMATIC WORD CORRECTION
PATENT.
AND IN THE '172 PATENT, WE ARE ASSERTING CLAIM 18, AND
10
THAT COVERS AN EFFECTIVE WAY TO DISPLAY AND ACCEPT WORD
11
CORRECTIONS WHEN TYPING ON A MOBILE DEVICE WITH A TOUCHSCREEN.
12
PEOPLE WERE MOVING FROM KEYBOARDS TO TOUCHSCREENS.
IT WAS
13
A NEW WAY OF APPROACHING THINGS.
14
TOUGHER BECAUSE THE TARGETS ARE SMALLER.
15
WHETHER OR NOT YOU COULD TYPE ACCURATELY, AND IN ORDER TO
16
ASSIST THAT, IN ORDER TO MAKE IT USABLE, AN AUTOMATIC
17
CORRECTION INVENTION GAVE PEOPLE THE CONFIDENCE THAT THEY COULD
18
DO CORRECT AND ACCURATE TYPING ON THE TOUCHSCREEN DEVICE.
19
THE TOUCHSCREEN IS A LITTLE

THERE WAS A CONCERN
THIS INVENTION IN THE '172 DISPLAYS AS A PARTICULAR WAY OF
20
DOING THAT, DISPLAYS THE TEXT THAT YOU ARE ACTUALLY TYPING IN
21
ONE PLACE AND ON A SECOND PLACE ON THE PHONE IT SHOWS ONE OR
22
MORE WORD SUGGESTIONS AND THE EXACT TEXT THAT YOU HAVE TYPED.
23
THE PHONE WILL AUTOMATICALLY ACCEPT THE CORRECTION AND PUT
24
IN THE CORRECTED WORD IF YOU TAP ON THAT WORD OR IF YOU PRESS
25
THE SPACE KEY.
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SO IF YOU ARE A TYPIST AND YOU GO ON, THE SOFTWARE IS, IN
FACT, CORRECTING YOUR TYPING AS YOU GO AHEAD SO THAT YOU CAN DO
IT WITH SPEED AND WITH CONFIDENCE.
4
5
6
THE THIRD PATENT, THE '647 PATENT, IS WHAT WE CALL THE

QUICK LINKS PATENT OR THE DATA CONNECTORS PATENT.
THIS IS ANOTHER PART YOU WILL RECOGNIZE IT AS SOON AS I
TELL YOU WHAT IT IS, BUT IT'S ANOTHER PART OF BEING A VERY
EFFECTIVE AND USEFUL COMMUNICATIONS DEVICE.
UNDER THIS PATENT, A PHONE THAT USES THIS INVENTION
10
RECOGNIZES THE PATTERNS OF CERTAIN KIND OF DATA THAT HAVE BEEN
11
ENTERED INTO THE PHONE.
12
PHONE NUMBER, OR IT RECOGNIZES THAT SOMETHING IS AN E-MAIL
13
ADDRESS, OR IT RECOGNIZES SOMETHING IS A RESIDENTIAL ADDRESS.
14
SO IT RECOGNIZES THAT SOMETHING IS A
AND WHEN IT SEES THAT FORMAT, IT PRESENTS IT TO YOU ALONG
15
WITH A MENU THAT ALLOWS YOU TO USE THAT INFORMATION IN AN
16
EFFECTIVE AND EFFICIENT WAY.
17
IN OTHER WORDS, IF I SENT YOU -- WELL, I WON'T DO IT FOR
18
ME BECAUSE YOU WOULDN'T CALL ME BACK.
BUT IF SOMEONE YOU LIKED
19
CALLED YOU, SENT YOU A PHONE NUMBER IN AN E-MAIL, INSTEAD OF
20
YOU HAVING TO REMEMBER WHAT THAT PHONE NUMBER WAS OR PUT YOUR
21
PHONE DOWN AND WRITE IT DOWN AND THEN GO BACK AND ENTER IT INTO
22
THE PHONE, WHAT THIS INVENTION DOES IS IT RECOGNIZES THAT IT'S
23
A PHONE NUMBER AND IT PRESENTS YOU A MENU THAT ALLOWS YOU TO
24
SAY CALL THE NUMBER BACK, PUT IT INTO MY CONTACTS, RESPOND TO
25
AN E-MAIL, AND YOU CAN DO THAT ALL ON A TOUCHSCREEN WITHOUT
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EVER LOSING YOUR ATTENTION TO THE DEVICE THAT'S IN FRONT OF
YOU, AN EFFICIENT, FUN, AND USEFUL WAY TO COMMUNICATE BETTER.
THE FOURTH PATENT IS SOMETHING THAT IS CALLED THE
UNIVERSAL SEARCH PATENT.
THEY WERE COMBINING AN INTERNET BROWSER WITH A TELEPHONE.
AGAIN, REMEMBER WHAT MR. JOBS SAID,
AND WHAT UNIVERSAL SEARCH, THE IDEA BEHIND THIS INVENTION
WAS TO ALLOW A USER OF A PHONE TO SEARCH FOR DATA
SIMULTANEOUSLY ON THE PHONE ITSELF AND ON THE INTERNET.
I'LL SHOW YOU EXAMPLES OF THESE A LITTLE BIT LATER.
10
AND
BUT WHAT IT MEANS IS YOU COULD ADD SEARCH TERMS, AND THEY
11
WOULD COME BACK TO YOU WITH A SEARCH THAT SEARCHED EVERYTHING
12
THAT WAS ON YOUR PHONE BUT ALSO THE INTERNET.
13
BUT BETTER THAN THAT, IT USED SMART SOFTWARE SO THAT IT
14
PRESENTED THE RESULTS OF THOSE SEARCHES TO YOU NOT RANDOMLY,
15
BUT BASED ON YOUR USAGE OF THE PHONE, IT PRESENTED THE
16
SUGGESTIONS TO YOU IN A WAY THAT THEY THOUGHT THAT YOU WOULD
17
FIND USEFUL.
18
THE LAST PATENT, THE '414 PATENT, IS WHAT WE CALL THE
19
BACKGROUND SYNC PATENT.
20
CERTAIN APPLICATIONS ON YOUR PHONE, SUCH AS THE CALENDAR AND
21
THE CONTACTS APPLICATION, TO SHARE INFORMATION EITHER WITH EACH
22
OTHER OR WITH OTHER COMPUTERS IN THE BACKGROUND WHILE YOU ARE
23
STILL USING YOUR PHONE.
24
25
AND THIS IS A PROGRAM THAT ALLOWS
SOME OF YOU MAY BE FAMILIAR WITH OLDER PHONES WHERE TO

SYNC THIS INFORMATION, YOU WOULD HAVE TO STOP USING IT OR YOU
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WOULD GET A SIGNAL ON THE PHONE THAT SAY WAIT UNTIL WE'RE
THROUGH SYNCING OR I HAD AN OLD BLACKBERRY WHERE YOU HAD TO PUT
IT ON THE STAND AND THAT WAS INTERRUPTING, YOU COULDN'T KEEP
USING YOUR PHONE, AND THIS INVENTION ALLOWS THE PHONE TO DO IT
AT THE SAME TIME SO THAT THE USER IS NEVER DISRUPTED AND NEVER
UNDERSTANDS ACTUALLY THAT THE SYNCING IS HAPPENING IN THE
BACKGROUND.
SO THERE ARE FIVE APPLE PATENTS INVOLVED IN THIS TRIAL.
BUT I NEED TO MAKE ONE THING CLEAR.
10
11
THE EVIDENCE IN THIS
CASE WILL BE THAT SAMSUNG COPIED THE IPHONE.

AND IT ALSO TOOK MANY OTHER NOVEL APPLE INVENTIONS THAT
12
MAY NOT YET HAVE APPEARED IN APPLE PRODUCTS.
13
MANY FEATURES.
14
IT COPIED MANY,
BUT THERE ARE LIMITS ON WHAT WE CAN ACCOMPLISH IN A SINGLE
15
TRIAL.
16
TRY 50 PATENTS IN THIS CASE, SO WE ARE TRYING 5.
17
YOU'RE ALREADY GIVEN US A MONTH OF YOUR TIME.
MR. QUINN:
YOUR HONOR, I OBJECT.
19
THE COURT:
OVERRULED.
20
MR. MCELHINNY:
18
WE CAN'T
THIS IS NOT
PROPER.
I HAVE ALREADY SHOWN YOU HOW
21
CRITIQUES AND THE WORLD IN GENERAL REACTED TO THE INTRODUCTION
22
OF THE IPHONE.
23
REACTION, WE'RE HERE TODAY BECAUSE OF HOW ONE PARTICULAR
24
COMPETITOR, SAMSUNG ELECTRONICS, CHOSE TO REACT TO THE IPHONE.
25
BUT WE ARE HERE TODAY, NOT BECAUSE OF A GENERAL
AS I PREVIOUSLY MENTIONED, SAMSUNG WAS ALREADY A PLAYER, A
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2
3
4
HUGE PLAYER IN THE PHONE FIELD IN 2007.

BUT ONCE THE IPHONE WENT ON SALE, SAMSUNG PRETTY QUICKLY
RECOGNIZED TWO THINGS.
FIRST, THAT THE IPHONE WAS TAKING THE WORLD BY STORM.
CONSUMERS LOVED IT.
IPHONES FOLLOWED BY THE IPADS WERE
LITERALLY FLYING OFF THE SHELVES OF STORES.
BUT THE OTHER THING THAT SAMSUNG RECOGNIZED WAS THAT IT
SIMPLY DID NOT HAVE A PRODUCT THAT COULD COMPETE SUCCESSFULLY
AGAINST THE IPHONE.
10
AND SO BY FEBRUARY 10TH, 2010, SAMSUNG HAD REACHED A
11
CRISIS POINT, A CRISIS POINT.
12
"CRISIS" IS SAMSUNG'S WORD.
13
14
15
"CRISIS" IS NOT MY WORD.
LET ME GIVE YOU A LITTLE BACKGROUND FOR THOSE OF YOU WHO

ARE NOT FAMILIAR WITH LITIGATION.
PART OF THE PROCESS HERE, AS THIS LAWSUIT HAS BEEN
16
PENDING, IS THAT EACH SIDE HAS TO TURN OVER TO THE OTHER ITS
17
INTERNAL DOCUMENTS, ITS INTERNAL E-MAILS, ITS INTERNAL HISTORY
18
OF DOCUMENTS.
19
AND BECAUSE WE HAVE OBTAINED SAMSUNG'S INTERNAL DOCUMENTS,
20
WE HAVE BEEN ABLE TO RECONSTRUCT WHAT SAMSUNG WAS ACTUALLY
21
THINKING, WHAT WAS REALLY HAPPENING.
22
SAME AS WHAT YOU GET TOLD IN THIS TRIAL, BUT WE HAVE THE
23
DOCUMENTS TO SHOW YOU WHAT WAS REALLY HAPPENING AT A PARTICULAR
24
PERIOD OF TIME.
25
AND IT MAY NOT BE THE
AND SO IN THIS CASE WE WILL BE ABLE TO SHOW YOU THE
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FOLLOWING EXHIBIT:
THAT WAS HELD ON FEBRUARY 10TH, 2010.
J.K. SHIN, WHO WAS THE HEAD OF THE ENTIRE PHONE DIVISION AT
SAMSUNG, CALLED A HUGE MEETING OF ALL THE SAMSUNG'S SENIOR
MANAGERS.
SUFFERING, IN HIS WORDS, "A CRISIS OF DESIGN."
THIS IS AN E-MAIL THAT REFLECTS A MEETING
HE SCOLDED THEM.
AND AT THAT MEETING,
HE TOLD THEM THAT SAMSUNG WAS
HE SAID "THE DIFFERENCE IN USER EXPERIENCE" -- UX STANDS
FOR USER EXPERIENCE IN THE SAMSUNG TERMINOLOGY -- "THE
DIFFERENCE IN USER EXPERIENCE BETWEEN THE IPHONE AND SAMSUNG
10
PHONES WAS," QUOTE, "'THE DIFFERENCE BETWEEN HEAVEN AND
11
EARTH.'"
12
AND HE TOLD HIS MANAGERS THAT U.S. PHONE CARRIERS -- AND
13
THE UNITED STATES, AS YOU KNOW, THEY ARE THE LARGEST SELLERS OF
14
PHONES IN THE UNITED STATES, U.S. PHONE CARRIER COMPANIES,
15
MR. SHIN TOLD HIS MANAGERS THAT THE U.S. PHONE CARRIERS WERE
16
TELLING HIM TO, QUOTE, "MAKE SOMETHING LIKE THE IPHONE."
17
18
19
BECAUSE -- AND, AGAIN, I QUOTE HIM, "THE IPHONE HAS BECOME

THE STANDARD."
IF WE MOVE FORWARD TO TODAY, WHAT WE ALL KNOW IS THAT THIS
20
IS EXACTLY WHAT SAMSUNG HAS PROCEEDED TO DO.
21
THE PHONES THAT WE ARE ACCUSING IN THIS CASE LOOK LIKE.
22
THESE ARE WHAT
WE ALL KNOW NOW THAT SAMSUNG CHOSE TO MAKE AND SELL IN THE
23
UNITED STATES PHONES AND A TABLET THAT INFRINGED THE FIVE
24
PATENTS I SHOWED YOU EARLIER.
25
THIS CASE IS ABOUT THE FOLLOWING LIST OF PHONES AND
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TABLETS.
SIMILAR TO THIS.
WILL HAVE A LIST THAT LISTS THE VARIOUS SAMSUNG PHONES THAT WE
ARE ACCUSING.
ALL FIVE PHONES, SOME OF FOUR, AND SO ON.
WHEN YOU DO YOUR VERDICT, YOU WILL HAVE A LIST

YOU WON'T HAVE THE X'S FILLED IN, BUT YOU
AND IN THESE CASES WE ACCUSE SOME OF INFRINGING
BUT OUR EXPERTS AND OUR -- AS THE EVIDENCE COMES IN, YOU
WILL GET MORE DETAIL ABOUT THIS.
PHONES THAT WE'RE ACCUSING IN THIS CASE OF INFRINGING THESE
FIVE PATENTS.
10
WOULD NOW BE A GOOD TIME FOR A BREAK?
11
THE COURT:
12
MR. MCELHINNY:
13
THE COURT:
14
15
BUT THIS IS THE LIST OF
THAT'S FINE.
IT'S 10:30.
ALL RIGHT.
AGAIN, PLEASE DON'T RESEARCH
OR DISCUSS THE CASE.

THERE ARE A LOT OF PEOPLE HERE, SO I THINK THERE MIGHT BE
16
A LENGTH OF TIME TO USE THE RESTROOM.
17
BREAK.
WE'LL TAKE A 20 MINUTE
18
BUT PLEASE BE READY TO GO RIGHT IN 20 MINUTES.
19
PLEASE DON'T RESEARCH OR DISCUSS THE CASE.
20
(RECESS FROM 10:30 A.M. TO 10:51 A.M.)
21
22
23
24
25
THE COURT:
OKAY.
WELCOME BACK.
ALL RIGHT?
THANK YOU.
TIME IS NOW 10:51.
GO AHEAD, PLEASE.
MR. MCELHINNY:
THANK YOU.
WE ALSO KNOW NOW FROM THE DOCUMENTS THAT WE HAVE OBTAINED
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THAT SAMSUNG SPECIFICALLY CHOSE TO COPY THE FEATURES THAT WE'RE
ASSERTING IN THIS CASE.
IN FACT, WHAT YOU'LL SEE FROM THE DOCUMENTS IS THAT
COPYING THE IPHONE WAS LITERALLY BUILT INTO THE SAMSUNG
DEVELOPMENT PROCESS.
DURING THE TRIAL, YOU WILL SEE THIS DOCUMENT, PLAINTIFF'S
EXHIBIT 119.
GROUP IN EUROPE.
THIS IS A 2009 DOCUMENT FROM THE SAMSUNG DESIGN
THE TITLE OF THE DOCUMENT IS "MIEUX."
THAT'S A FRENCH
10
WORD THAT MEANS -- I'VE BEEN WAITING FOR 35 YEARS IN A
11
COURTROOM TO SAY PARDON MY FRENCH -- BUT THAT IS A FRENCH WORD
12
THAT I AM TOLD MEANS "BETTER."
13
SO IT SAID "MIEUX, EMOTIONAL UX," WHICH IS USER
14
EXPERIENCE, AND THEN IT SAID "MAKE IT EMOTIONAL UX," WHICH IS
15
M-I-E-U-X.
16
ON THE NEXT PAGE, THEY TELL US THAT WHAT THEY WERE
17
STUDYING WAS "CREATING A MORE INTUITIVE AND EMOTIONAL SAMSUNG
18
MOBILE INTERFACE."
19
AND ON THE THIRD PAGE, THEY SAY THAT WHAT THEY WERE
20
LOOKING AT "SMALL, YET FUNDAMENTAL, PARTS OF THE USER INTERFACE
21
."
22
REMEMBER THAT WORD, FUNDAMENTAL.
YOU WILL NOT BE HEARING
23
FUNDAMENTAL FROM ANY SAMSUNG WITNESS OR EXPERT OR ANYONE WHO
24
TESTIFIES ON THEIR BEHALF AT THIS TRIAL.
25
BUT THIS IS WHAT THEY WERE CALLING THESE INTERFACES IN
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THEIR INTERNAL DOCUMENTS, DOCUMENTS THAT THEY NEVER EXPECTED TO
SEE PUBLICLY IN A COURTROOM.
FUNDAMENTAL.
SO LET'S SEE WHAT THEY SAID ABOUT SLIDE TO UNLOCK.
ON PAGE 11, THEY HAD A PAGE THAT WAS CALLED "APPLYING
5
6
MEANINGFUL CREATIVITY."
AT THE TOP, IN THE PICTURES AND THE TWO BOXES ON THE LEFT,
THEY TALK ABOUT THE EXISTING UNLOCK FUNCTIONS ON THE SAMSUNG
PHONES, WHAT THEY HAD AT THE TIME.
AN UNLOCK SCREEN OR AN OKAY BUTTON, AND THE OTHER WAS WHERE YOU
10
11
ONE WAS WHERE YOU PRESSED
HELD DOWN THE HOLD KEY.

AND SAMSUNG'S OWN DESIGNERS SAID THAT THOSE WAYS OF
12
UNLOCKING THE PHONE "DO NOT EVOKE EMOTION," AND FOR THE OTHER
13
ONE, "IS NOT APPEALING."
14
IN CONTRAST, AT THE BOTTOM HALF OF THE PAGE, THE DESIGNERS
15
CALLED OUT WHAT THEY CALLED, QUOTE, "A CREATIVE WAY TO SOLVE
16
USER INTERFACE COMPLEXITY," AND THE EXAMPLE THAT THEY SHOWED
17
WAS THE IPHONE.
18
AND WHAT THEY SAID WAS "SWIPING UNLOCK ON THE SCREEN
19
ALLOWS TO PREVENT ERRONEOUS UNLOCK EVEN WITHOUT USING A HARD
20
KEY AND USERS FIND IT FUN TO SWIPE."
21
22
23
THIS IS ONE OF THEIR EXAMPLES OF A FUNDAMENTAL PART OF THE

USER INTERFACE.
NOW, SAMSUNG IS GOING TO TELL YOU THAT THERE'S NOTHING
24
WRONG WITH THEM LOCKING AT THE IPHONE.
THEY'RE GOING TO SAY
25
EVERY COMPANY KEEPS AN EYE ON THEIR COMPETITORS.
IT'S CALLED
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COMPETITIVE INTELLIGENCE.
THAT.
DOING AND THERE'S NOTHING WRONG WITH THAT.
AND TO A POINT, ALL OF THAT IS TRUE.
BUT THE EVIDENCE IS GOING TO SHOW YOU THAT SAMSUNG DID NOT
6
7
THEY'RE GOING TO SAY APPLE DOES
ALL COMPANIES KEEP AN EYE ON WHAT THEIR COMPETITORS ARE
STOP WITH COMPETITIVE INTELLIGENCE.

YOU WILL SEE ALSO THIS DOCUMENT.
THIS IS PLAINTIFF'S
EXHIBIT 121.
ORIGINAL KOREAN AND WITH AN ENGLISH TRANSLATION, SO IT'S NOT
10
QUITE THIS THICK, BUT IT'S HALF THIS THICK, AND I'M GOING TO
11
SHOW YOU SOME PAGES OF IT.
12
13
14
THIS IS ACTUALLY TWO COPIES OF IT.
IT'S IN THE
AND IT'S DATED MAY 31ST, 2010, AND IT WAS CALLED VICTOR
USABILITY EVALUATION RESULTS.
AND THE EVIDENCE WILL BE THAT VICTOR WAS A CODE NAME FOR A
15
TELEPHONE THAT THEY HAD UNDER DEVELOPMENT.
SO THIS WAS A
16
SURVEY THAT WAS DONE USING THE VICTORY TO DETERMINE WHAT
17
CHANGES THEY NEEDED TO MAKE.
18
THE DOCUMENT IS 219 PAGES LONG.
19
THE THIRD SECTION WAS CALLED "MAIN USER EXPERIENCE
20
USABILITY ISSUES."
21
AND IT BEGINS ON PAGE 22.
22
THE DOCUMENT THEN SETS OUT 88 OF THE MAIN ISSUES OR
23
PROBLEMS THAT HAD BEEN IDENTIFIED BY A SURVEY GROUP WHO IT
24
TESTED THIS VICTORY PROTOTYPE, AND EACH OF THOSE ISSUES IS
25
PRESENTED IN EXACTLY THE SAME KIND OF FORMAT.
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2
3
SO LET'S LOOK AT PAGE 30 -- 29 OF THE EXHIBIT.

WANT TO SHOW YOU THE FORMAT.
AT THE TOP OF THE PAGE IS THE NAME OF THE PARTICULAR ISSUE
THAT THEY'RE LOOKING AT.
"EFFICIENCY_BROWSING."
I JUST
IN THIS CASE, IT SAID
THEN IT DESCRIBED THE PROBLEM, AND IN THIS CASE THE
PROBLEM WAS THAT THE PROTOTYPE DOES NOT PROVIDE A FOLDER
FUNCTION IN THE ADD TO FAVORITES.
AND THEN THERE'S A COMPARISON WITH THE VICTORY ON THE LEFT
10
SIDE AND THE IPHONE ON THE RIGHT SIDE AND A DESCRIPTION OF THE
11
DIFFERENCES.
12
AND THEN AT THE BOTTOM OF EACH PAGE, THERE IS AN ENTRY
13
THAT SAYS "DIRECTION OF IMPROVEMENT" TO THE DESIGN.
14
EXAMPLE, THE DIRECTION WAS TO ADD A FOLDER FUNCTION TO ALLOW
15
THE USER TO ORGANIZATION THEIR FAVORITES.
16
17
SO IN THIS
"MODIFY TO ADD THE FOLDER FUNCTION TO THE WEBSITE

FAVORITES."
18
88 IN THIS DOCUMENT ALONE OF THESE SIMILAR COMPARISONS.
19
IT TURNS OUT THAT SEVERAL OF THE 88 ISSUES IN THIS
20
21
22
23
DOCUMENT INVOLVED THE UNLOCKING FUNCTION.

ON PAGE 27, WE SEE THIS ONE, NUMBER 5, "EFFICIENCY_SCREEN
LOCK."
THE PROBLEM WAS THAT THE VICTORY FREQUENTLY COULDN'T BE
24
UNLOCKED WITH ONE SWIPE.
BUT THEY NOTED THAT THE IPHONE,
25
HOWEVER, WAS EASILY UNLOCKED BY SLIDING A FIXED DISTANCE.
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SO THE DIRECTION OF IMPROVEMENT FOR THE NEW SAMSUNG
PHONES -- THINK ABOUT IT.
PHONES.
THIS IS HOW THEY ARE DESIGNING THE
AND THE DIRECTION OF IMPROVEMENT IS "MODIFY THE DEFAULT
UNLOCKING METHOD SO AS TO ALLOW EASY UNLOCKING WITH ONE MOTION,
BY MAKING THE TOUCH DISTANCE CLEAR SUCH AS WITH SLIDING OR
MOVING A PUZZLE (PIECE)."
8
9
10
11
BUT IF THAT'S NOT CLEAR ENOUGH FOR YOU, IF THAT LEAVES ANY
DOUBT IN YOUR MIND, TURN TO PAGE 100 OF THE EXHIBIT, AND THERE
WE COME BACK TO LOCK, "SATISFACTION LEVEL_LOCK SCREEN."
HERE THE PROBLEM WAS THAT THE VICTORY PROTOTYPE WAS TOO
12
EASY TO UNLOCK WITH A SIMPLE FLICK MOTION.
13
THE IPHONE WAS DESCRIBED AS "PRECISE."
14
SO READ THE DIRECTION OF IMPROVEMENT.
15
CLARIFY THE UNLOCKING STANDARD BY SLIDING."
16
17
18
THE UNLOCKING IN
"SAME AS IPHONE,
THE DIRECTION OF IMPROVEMENT IN THEIR INTERNAL DOCUMENTS,

SAME AS IPHONE.
SAMSUNG WENT FAR BEYOND THE WORLD OF COMPETITIVE
19
INTELLIGENCE AND THEN CROSSED INTO THE DARK SIDE OF INTENTIONAL
20
COPYING.
21
YOU WILL FIND THAT THE SAME IS TRUE WITH THE QUICK LINKS
22
OR DATA DETECTORS.
23
DOCUMENT, WHICH IS PLAINTIFF'S EXHIBIT 106.
24
25
THERE WE'LL SHOW YOU THIS EXHIBIT -- THIS
WHAT THIS IS, AND YOU'LL HERE MORE ABOUT IT IN TRIAL, IS

THAT THIS IS A COPY OF AN ARTICLE THAT HAD BEEN WRITTEN IN 1998
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AND THEN POSTED ON AN APPLE -- THE INVENTOR, ONE OF THE
INVENTORS OF THE APPLE PATENT AND THEN IT HAD BEEN POSTED IN
2010, I BELIEVE, ON THE APPLE WEBSITE.
SO I JUST WANT YOU TO SEE THIS ARTICLE.
ON THE SECOND
PAGE OF THE ARTICLE, IT HAD A FIGURE -- IT HAS A SECTION CALLED
APPLE DATA DETECTORS, WHICH AS YOU'LL RECALL IS THE OTHER NAME
FOR OUR PATENT, WHAT WE CALL THE QUICK LINKS PATENT.
8
9
ON THE NEXT PAGE, IT HAD A FIGURE THAT ILLUSTRATED, AND AS

YOU SEE THE TITLE AT THE BOTTOM, IT SAYS FIGURE 1, APPLE DATA
10
DETECTORS IN ACTION.
11
FOR A MOMENT.
12
DETECTORS IN ACTION.
AND JUST HOLD THIS PICTURE IN YOUR MIND
THAT'S THE FIGURE DESCRIBED AS APPLE DATA
13
NOW WE'RE GOING TO JUMP FORWARD TO 2011, AND WE'RE GOING
14
TO LOOK AT THIS SAMSUNG DOCUMENT, WHICH IS PLAINTIFF'S EXHIBIT
15
107, WHICH WAS CALLED A USER EXPERIENCE ROADMAP.
16
17
18
THERE, ON PAGE 52, WE HAVE SOMETHING WHICH THEY CALLED A

PROJECT PROPOSAL FOR A SMART ORGANIZER.
AND IT DESCRIBES THE PROPOSAL AND IT SAYS THAT IT, QUOTE,
19
"AUTOMATICALLY APPLIES TO CALENDAR SCHEDULE IN THE E-MAIL
20
CONTENTS ACCORDING TO THE USER'S INTENT."
21
AND THERE, LO AND BEHOLD, SAMSUNG SIMPLY CUT AND PASTED
22
THE ILLUSTRATION FROM THE APPLE ARTICLE INTO ITS OWN ROADMAP,
23
BUT TOOK SPECIAL CARE TO CHANGE THE CAPTION SO THAT IT NOW SAYS
24
"E-MAIL CONTENT RECOGNITION, ARROW, CALENDAR."
25
THIS IS NOT COMPETITIVE INTELLIGENCE.
THIS IS CUT AND
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2
PASTE COPYING OF A PATENTED INVENTION.

THE COURT ALREADY TOLD YOU, IT'S IN THOSE INSTRUCTIONS AND
I HOPE IT JUMPED OUT AT YOU, BUT THE COURT HAS ALREADY TOLD YOU
THAT SAMSUNG INFRINGES THE AUTOMATIC WORD CORRECTION PATENT.
THAT IS A DETERMINATION THAT THE COURT HAS ALREADY MADE.
SO LET'S TALK ABOUT BACKGROUND SYNC.
IN BACKGROUND SYNC, YOU'LL SEE THIS ARTICLE, WHICH IS
EXHIBIT 115.
NOVEMBER 5, 2009 DESCRIBING PRODUCTS THAT WERE UNDER
10
11
AND THIS IS AN INTERNAL SAMSUNG E-MAIL DATED
DEVELOPMENT.
ON PAGE 3, IT HAS A SECTION THAT EXPRESSLY DESCRIBES
12
BACKGROUND SYNC.
13
PROGRESS."
14
IT SAYS "ACCESS TO PHONEBOOK WHILE SYNC IS IN
IT DESCRIBES THAT INVENTION AS SOMETHING THAT IS
15
MANDATORY, AND AT THE END, IN TERMS OF WHAT IT INTENDS TO DO,
16
IT SAYS "THIS MUST BE SUPPORTED FOR THE NEXT DEVICE OR
17
PLATFORM."
18
19
WITH RESPECT TO UNIVERSAL SEARCH, THE EVIDENCE IS A LITTLE

BIT DIFFERENT.
20
IN UNIVERSAL SEARCH, THE EVIDENCE WILL BE THAT AFTER WE
21
FILED THIS CASE, SAMSUNG TURNED THE UNIVERSAL SEARCH FUNCTION
22
OFF IN ITS PHONES.
23
BUT WHEN ITS USERS COMPLAINED ABOUT IT, IT MADE THE
24
DECISION TO TURN THE FUNCTION BACK ON BECAUSE THEIR USERS'
25
RESPONSE TO USING UNIVERSAL SEARCH WAS NEGATIVE AND STRONG.
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YOU WILL SEE THIS ARGUMENT -- THIS ARTICLE, PLAINTIFF'S
EXHIBIT 137, WHICH IS A CLIPPING FROM AN ARTICLE, A NEWSPAPER
CALLED "TMO NEWS," AND ON THE SECOND PAGE DESCRIBING THIS
HISTORY, THE NEWSPAPER SAYS, "IN WHAT APPEARS TO BE A LITTLE
KNOWN DEVELOPMENT FROM YESTERDAY'S GALAXY S III JELLY BEAN
UPDATE," THAT WAS A SOFTWARE UPDATE, "SAMSUNG LOOKS TO HAVE
SNUCK LOCAL SEARCH BACK INTO THEIR TOUCHWIZ SOFTWARE.
SEARCH, IF YOU'LL RECALL, WAS REMOVED TO THE GALAXY S III IN
RESPONSE TO APPLE'S LAWSUITS COURTESY OF A MAINTENANCE UPDATE
10
11
LOCAL
THIS PAST AUGUST."

IT GOES ON TO SAY, "WE'RE THRILLED TO SEE ITS RETURN.
12
LOCAL SEARCH ALLOWS FOR THE SEARCH APP TO LOOK FOR FILES ON THE
13
PHONE, LIKE CONTACTS OR APPS, WHEN USERS ATTEMPT A WEB SEARCH
14
FROM A PRELOADED SEARCH APP.
15
ANDROID AND ITS REMOVAL BACK IN AUGUST WAS DISHEARTENING.
16
SEEING IT RETURN IS WONDERFUL."
17
THIS IS AN AWESOME FEATURE FOR
FINALLY, YOU'LL SEE MORE OF THESE IN TRIAL, BUT FINALLY
18
FOR MY OPENING, I WANT TO SHOW YOU THIS DOCUMENT, WHICH IS
19
PLAINTIFF'S EXHIBIT 147.
20
THE IMPACT OF THE IPHONE 3G ON THE U.S. MARKET.
21
22
THIS IS A 2008 DOCUMENT THAT ASSESSED
ON PAGE 2, AS ITS OVERALL CONCLUSION, SAMSUNG NOTED "3G

IPHONE IS REDEFINING THE U.S. MARKET DYNAMICS."
23
IT CONCLUDES, "WHILE TRADITIONAL OEM'S," WHICH STANDS FOR
24
ORIGINAL EQUIPMENT MANUFACTURERS, "ARE BUSY FIGHTING EACH OTHER
25
IN THE FEATURE PHONE SPACE" YOU HEARD THAT WAS THE BUTTON
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PHONES, "IN THE FEATURE PHONE SPACE APPLE IS BUSY MAKING THE
CATEGORY OBSOLETE."
THIS IS A SAMSUNG DOCUMENT.
ON PAGE 9 THEY SAID "SAMSUNG STRENGTHS DO NOT TRANSLATE
5
6
WELL TO TOUCH."
THEY CONCLUDE -- IT'S INTERESTING, YOU WILL HEAR FROM
SAMSUNG, "WE'RE SUCCESSFUL BECAUSE WE MAKE A HUNDRED DIFFERENT
KINDS OF PHONES AND APPLE ONLY MAKES ONE," ET CETERA.
BUT IN THEIR INTERNAL DOCUMENT, THEY SAY "IN THE TOUCH
10
SEGMENT DIFFERENTIATED ID'S" IN THE INDUSTRIAL DESIGNS "HAVE
11
LITTLE UTILITY.
12
VARIETY OF UNIQUE ID'S" FOR INDUSTRIAL DESIGNS "SERVES IT VERY
13
WELL IN THE FEATURE PHONE SEGMENT.
14
IS ALMOST IRRELEVANT."
15
16
17
18
19
SAMSUNG'S COMPETITIVE ADVANTAGE TO PROVIDE A
FOR TOUCH, THIS CAPABILITY
I WANT TO SHOW YOU THEIR CONCLUSION, WHICH IS PARTICULARLY

COMPELLING FOR THIS CASE, AND THAT'S ON PAGE 13.
THE CONCLUSION AT THE TOP SAID "SOFTWARE IS THE NEW VALUE
DRIVER."
AND THEY SAY, "WHAT MAKES THE IPHONE UNIQUE IS SOFTWARE
20
(APPLICATIONS) AND SERVICES, BEAUTIFUL HARDWARE IS JUST A
21
BONUS."
22
IN THIS CASE, AS YOU HEAR LAWYERS, AS YOU HEAR THE
23
WITNESSES FOR SAMSUNG GET UP THERE AND SAY OUR SOFTWARE PATENTS
24
ARE NOT VALUABLE, THEY'RE TRIVIAL, THEY DON'T MAKE A
25
DIFFERENCE, CUSTOMERS DON'T CARE, REMEMBER WHAT THEIR INTERNAL
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2
DOCUMENTS SAID.
THEY CHOSE TO USE OUR INVENTIONS BECAUSE THEY BELIEVED
THOSE INVENTIONS WERE FUNDAMENTAL TO HAVING A SUCCESSFUL
PRODUCT.
ALSO KEEP IN MIND THAT WHILE EVIDENCE OF COPYING MAKES
INFRINGEMENT MORE LIKELY, AND HELPS SHOW SAMSUNG'S STATE OF
MIND -- YOU'VE HEARD ABOUT WILLFULNESS -- WE DON'T HAVE TO
PROVE COPYING TO PROVE INFRINGEMENT.
THAT SAMSUNG IS ACTUALLY USING OUR PATENTED INVENTIONS.
10
ALL WE NEEDED TO SHOW IS
SO LET'S TALK ABOUT INFRINGEMENT.
IN THIS CASE, YOU WILL
11
MEET SOME OF THE INVENTORS WHO CREATED THESE FEATURES.
12
FRANKLY, WE'RE ON A TIME CLOCK.
13
THAT TO YOU.
14
WILL SEE SOME OF THEM.
15
16
17
I THINK THE JUDGE MENTIONED
YOU WILL NOT SEE ALL OF THE INVENTORS, BUT YOU
BUT WE WILL ALSO BRING EXPERT EVIDENCE THAT SAMSUNG

INFRINGES EACH OF THE FIVE CLAIMS THAT WE'RE ASSERTING.
YOU WILL HEAR FROM PROFESSOR ANDREW COCKBURN, WHO WILL
18
TALK ABOUT THE '172 AND '721 PATENTS.
19
EXPERT IN SOFTWARE RELATING TO HUMAN COMPUTER INTERFACES.
20
AGAIN, WE WON'T TALK ABOUT INFRINGEMENT OF THE '172
21
22
PROFESSOR COCKBURN IS AN
BECAUSE SAMSUNG INFRINGES AND THAT'S ALREADY BEEN DETERMINED.

PROFESSOR COCKBURN WILL WALK US THROUGH THE SLIDE TO
23
UNLOCK PATENT AND SHOW HOW EASY IT IS TO USE IN THE SAMSUNG
24
DEVICES, HOW IT IS USED IN THE SAMSUNG DEVICES.
25
LET'S LOOK AT THIS VIDEO.
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THIS IS ONE EXAMPLE OF THE WAY SAMSUNG HAS IMPLEMENTED
APPLE'S SLIDE TO UNLOCK TECHNOLOGY.
PHONE.
PLAY WITH, BUT THIS IS THE ADMIRE PHONE.
THIS IS AN ACCUSED ADMIRE
THEY ALL HAVE THESE TITLES WHICH WE'RE GOING TO HAVE TO
ON THE LOCK SCREEN -- I'M SHOW YOU THE VIDEO IN A MINUTE.
LET ME TELL YOU WHAT HAPPENS.
ON THE LOCK SCREEN, THERE'S A
GREEN PADLOCK ICON ON THE LEFT-HAND SIDE OF THE PHONE.
YOU ARE READY TO UNLOCK THE PHONE, YOU TOUCH THAT GREEN PADLOCK
ICON.
THE ICON ON THE RIGHT SLIDE OF THE SCREEN SLIDES OUT OF
10
VIEW AND A SMALL DOT APPEARS IN ITS PLACE.
11
ICON OVER TO THE DOT AND THAT UNLOCKS THE PHONE.
12
YOU SUPPLIED THE
13
MR. MCELHINNY:
DR. TODD MOWRY WILL TALK ABOUT THE
14
'647 PATENT.
15
MELLON UNIVERSITY, AGAIN, AN EXPERT IN HIS FIELD.
16
WHEN
PROFESSOR MOWRY IS A PROFESSOR FROM CARNEGIE
HERE IS AN EXAMPLE OF HOW SAMSUNG HAS IMPLEMENTED THE
17
QUICK LINKS TECHNOLOGY IN THE '647 PATENT INTO ITS PRODUCTS.
18
WE'RE GOING TO SHOW YOU WHAT'S CALLED THE MESSAGING APPLICATION
19
IN THE SAMSUNG EPIC 4G PHONE.
20
SO YOU'LL SEE HERE IN THIS VIDEO THAT THE USER HAS
21
RECEIVED A TEXT MESSAGE WITH A PHONE NUMBER AND AN E-MAIL
22
ADDRESS.
23
WITH VARIOUS ACTIONS APPEARS.
24
ACTIONS, SUCH AS CALLING THE NUMBER, AND THE PHONE APPLICATION
25
COMES UP AUTOMATICALLY TO MAKE THE CALL.
WHEN THE USER SELECTS THE PHONE NUMBER, A POP-UP MENU

THE USER CAN SELECT ONE OF THOSE
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AND, FINALLY, DR. ALEX SNOEREN WILL PRESENT THE '959
UNIVERSAL SEARCH PATENT AND THE '414 BACKGROUND SYNC PATENT.
DR. SNOEREN IS A PROFESSOR OF COMPUTER SCIENCE AND ENGINEERING
AT U.C. SAN DIEGO.
THIS IS A VIDEO FOR THE '959 PATENT, AGAIN, USING THE
EPIC 4G PHONE.
ON THE SAMSUNG PHONE.
THIS IS THE USER -- HOW UNIVERSAL SEARCH WORKS
(VIDEO PLAYING.)
MR. MCELHINNY:
A USER IS GOING TO LAUNCH A GOOGLE
10
SEARCH APPLICATION FROM THE HOME SCREEN, AND YOU CAN SEE THE
11
USER START TYPING IN A QUERY, AND HE PUT IN THE LETTERS APP.
12
THE SEARCH IMMEDIATELY RETURNS BOTH LOCAL RESULTS, JOHN
13
APPLESEED COMES FROM THE PHONE'S CONTACTS APPLICATION, AND
14
INTERNET RESULTS, AND YOU CAN SEE APPLE AND APPLE STORE HERE.
15
16
THE USER THEN SELECTS ONE OF THE INTERNET RESULTS, APPLE,

TO LAUNCH THAT RESULT IN THE BROWSER.
17
UNIVERSAL SEARCH ON A SAMSUNG PHONE.
18
AND, FINALLY -- AND I APOLOGIZE, THIS TAKES A MINUTE.
19
WE'RE GOING TO BE TALKING ABOUT BACKGROUND SYNC, AND IF WE
20
THINK ABOUT THE TECHNOLOGY ON BACKGROUND SYNC, A MESSAGE HAS TO
21
GO FROM THE PHONE TO A SERVER AND THEN BACK TO ANOTHER PHONE.
22
SO IT'S GOING TO TAKE A MINUTE FOR THAT SYNCING TO HAPPEN, BUT
23
YOU'LL SEE IT.
24
25
ON THE LEFT WE'VE GOT LARRY AND ON THE RIGHT WE'VE GOT
AARON.
BOTH OF THEM HAVE GMAIL ACCOUNTS.
SO THE E-MAILS SENT
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TO THEM GO FROM THEIR PHONES TO THE GMAIL SERVER BEFORE SYNCING
TO THE SMARTPHONE THAT YOU SEE HERE.
E-MAIL.
SO WE SEE AARON TYPING AN
MEANWHILE, LARRY SENDS AARON A MESSAGE.
AS AARON CONTINUES TO TYPE, YOU WILL SEE PRETTY SOON AFTER
IT GOES TO THE SERVER AND COMES BACK, AT THE TOP LEFT OF
AARON'S PHONE THE NAME LARRY ANDERSON WILL POP-UP, SHOWING THAT
AARON RECEIVES A NEW MESSAGE WHILE HE WAS USING THE PHONE.
8
9
WE'VE FROZEN IT THERE SO YOU CAN SEE THE NAME COMING UP

HERE.
WE KNOW WHILE HE WAS USING THE PHONE TYPING, SYNCING WAS
10
GOING ON IN THE BACKGROUND BECAUSE THE MESSAGE CAME AND THE
11
PHONE WAS ABLE TO SYNC THE INCOMING MESSAGE WITHOUT ANY
12
INTERRUPTION OR DELAY.
13
LADIES AND GENTLEMEN, WE'RE GOING TO MOVE A LITTLE BIT TO
14
NUMBERS.
BUT YOU'RE GOING TO HEAR IN THIS CASE THAT SAMSUNG
15
HAS SOLD MORE THAN 37 MILLION INFRINGING PHONES AND TABLETS IN
16
THE UNITED STATES.
37 MILLION.
17
SO WHAT IS SAMSUNG GOING TO SAY IN ITS DEFENSE?
18
OBVIOUSLY WE DON'T KNOW EXACTLY.
19
20
21
22
THEY HAVEN'T TOLD ME
EXACTLY WHAT THEY'RE GOING TO SAY.

BUT IN GENERAL YOU CAN EXPECT TO HEAR THE FOLLOWING
THINGS:
THEY'RE GOING TO SAY THAT THEY DON'T INFRINGE; THEY'RE
23
GOING TO SAY THAT THE EVIDENCE THAT THEY COPIED THE IPHONE IS
24
SIMPLY LAWFUL COMPETITION, LOOKING AT COMPETITOR'S PRODUCT.
25
BUT YOU WILL HAVE THE DOCUMENTS I SHOWED YOU.
YOU WILL
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HAVE OTHER DOCUMENTS, AND YOU WILL HAVE THE TESTIMONY OF
EXPERTS SO YOU WILL DETERMINE THAT INFRINGEMENT DISPUTE.
SAMSUNG IS ALSO GOING TO SAY THAT EVEN IF THEY DO
INFRINGE, IT DOESN'T REALLY MATTER BECAUSE APPLE ISN'T USING
SOME OF THESE INVENTIONS IN ITS PRODUCTS.
THE FIRST PROBLEM WITH THAT ARGUMENT IS A LITTLE BIT
OBVIOUS.
I MEAN, YOU CAN'T TAKE SOMEONE'S PROPERTY BECAUSE
THEY'RE NOT USING IT.
BEGINNING.
SO IT'S SORT OF A PROBLEM AT THE
10
BUT IF YOU THINK ABOUT IT, IT HAS AN EVEN MORE DEEP
11
SIGNIFICANCE BECAUSE WHEN SAMSUNG HAS TAKEN AN APPLE INVENTION
12
AND THEN INTRODUCED IT INTO THE MARKETPLACE, APPLE -- OR
13
SAMSUNG HAS BEEN TELLING THE MARKETPLACE THAT IT'S ITS
14
INVENTION AND THAT IT'S ITS CREATIVITY AND IT'S ALLOWED TO GIVE
15
THE IMPRESSION THAT IT ISN'T FROM APPLE BECAUSE IT IS USING
16
THESE APPLICATIONS THAT APPLE DOESN'T USE, EVEN THOUGH IT WAS
17
APPLE'S ENGINEERS WHO ACTUALLY ARE MAKING THAT CONTRIBUTION TO
18
THE IMPROVEMENT OF THIS WORLD.
19
THEY USE OUR INVENTIONS TO COMPETE AGAINST US.
20
YOU'RE ALSO GOING TO HEAR SAMSUNG POINT THE FINGER AT
21
GOOGLE.
22
SOME OF THESE PATENTS INVOLVE SOFTWARE.
23
THIS A LITTLE BIT IN THE VOIR DIRE YESTERDAY.
24
SOFTWARE.
25
THEY'RE GOING TO SAY, HEY, THIS IS ANDROID SOFTWARE.

AND YOU ACTUALLY HEARD
THIS IS ANDROID
WE GET IT THROUGH GOOGLE.
BUT DON'T, DON'T BE MISLED BY THAT.
THIS CASE IS NOT
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ABOUT GOOGLE.
AS YOU SAW FROM THESE DOCUMENTS AND AS YOU'LL SEE FROM
MORE, IT IS SAMSUNG THAT HAS MADE THE DECISION TO COPY THESE
FEATURES.
FEATURES INTO ITS PHONES.
6
7
IT IS SAMSUNG, NOT GOOGLE, THAT CHOSES TO PUT THESE
AND IT IS SAMSUNG, NOT GOOGLE, THAT IS SELLING THESE

PHONES FOR A PROFIT.
AND, FINALLY, IT IS SAMSUNG THAT HAS MADE THE CORPORATE
DECISION TO KEEP ON INFRINGING APPLE'S INTELLECTUAL PROPERTY.
10
NEXT, SAMSUNG IS GOING TO SAY EVEN IF THEY DID COPY AND
11
EVEN IF THEY DO INFRINGE, THAT'S OKAY BECAUSE EVERY ONE, EACH
12
OF THESE FIVE PATENTS IS INVALID.
13
CONVINCE YOU THAT THE PATENT AND TRADEMARK OFFICE MADE A
14
MISTAKE NOT ONCE, NOT TWICE, BUT ON EVERY ONE OF THE FIVE
15
PATENTS THAT WE CHOSE TO ASSERT IN THIS CASE.
16
THEY'RE GOING TO TRY TO
AS YOU HEARD FROM THE VIDEO, TO PROVE THAT DEFENSE,
17
SAMSUNG HAS A HIGHER BURDEN OF PROOF, WHICH JUDGE KOH WILL
18
EXPLAIN TO YOU AT THE END OF THE TRIAL.
19
AND THEN SAMSUNG IS GOING TO SAY, OKAY, EVEN IF WE DID
20
COPY, AND EVEN IF WE DID INFRINGE VALID PATENTS, IT'S NOT
21
REALLY A VERY BIG DEAL BECAUSE THESE INVENTIONS ARE TRIVIAL.
22
THEY'RE NOT IMPORTANT.
23
THAT WE COULD HAVE DONE THE SAME THING THAT AREN'T COVERED BY
24
YOUR PATENTS.
25
AND THERE'S A LOT OF DIFFERENT WAYS
THIS HAS A TECHNICAL NAME.
THE LAWYERS CALL IT
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ACCEPTABLE, NON-INFRINGING ALTERNATIVES.
I CALL IT THE
SHOULDA, COULDA, WOULDA LAW DEFENSE, BUT THAT'S NOT LEGAL.
BUT WHAT THEY'LL SAY IS EVEN THOUGH YOU'LL SEE DOCUMENT
AFTER DOCUMENT FROM SAMSUNG SAYING IT WAS THESE FEATURES THAT
WERE IMPORTANT TO CONSUMERS AND EVEN THOUGH SAMSUNG CHOSE TO
COPY THESE FEATURES, NOT SOME OTHER WAY, THAT BECAUSE THEY
COULD HAVE DONE IT SOME OTHER WAY, MAYBE THEY SHOULD HAVE DONE
IT SOME OTHER WAY, MAYBE THEY CAN DO IT SOME OTHER WAY, THESE
PATENTS HAVE NO VALUE.
10
BUT THE TRUTH IS, AND YOU CAN TELL FROM THE DOCUMENTS,
11
THAT IF SAMSUNG HAD EVEN SUSPECTED FOR A MOMENT THAT A JURY
12
WOULD BE ORDERING THEM TO PAY A FAIR PRICE FOR USING OUR
13
INVENTIONS, THEY MIGHT HAVE MADE DIFFERENT DECISIONS.
14
DIDN'T, BECAUSE THEY WENT WITH WHAT THEY THOUGHT WOULD SELL
15
THEIR PRODUCTS.
16
BUT THEY
SO, FINALLY, YOU WILL HEAR EVIDENCE ABOUT DAMAGES.
17
THINK ACTUALLY THIS PART WILL MAKE MORE -- IF ANYTHING I'VE
18
SAID TO YOU MAKES SENSE, I'M GLAD ABOUT THAT.
19
PART WILL MAKE MORE SENSE AFTER YOU'VE HEARD ALL THE EVIDENCE,
20
BUT I WANT TO GIVE YOU A HIGH OVERVIEW OF WHAT'S GOING TO
21
HAPPEN.
22
BUT I THINK THIS
IF YOU FIND INFRINGEMENT, AND AS I MENTIONED, WE ALREADY
23
KNOW THAT AT LEAST ONE OF THESE PATENTS IS INFRINGED, AND IF
24
YOU DECIDE THAT THE PATENT AND TRADEMARK OFFICE ACTUALLY WAS
25
CORRECT WHEN IT ISSUED THESE PATENTS, THEN YOU WILL BE CALLED
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UPON TO DECIDE THE ISSUE OF DAMAGES, AND YOU'RE GOING TO HEAR
TESTIMONY ABOUT TWO DIFFERENT KINDS OF DAMAGES.
THE FIRST ONE IS ACTUALLY PRETTY STRAIGHTFORWARD.
IT'S
CALLED LOST PROFITS.
IS PROPER THAT IF SAMSUNG HAD NOT BEEN ABLE TO SELL BECAUSE IT
COULDN'T USE OUR PROPERTY, IF IT HAD NOT BEEN ABLE TO SELL ITS
37 MILLION INFRINGING PHONES AND TABLETS, THAT SOME OF THOSE
CONSUMERS, SOME OF THEM WHO COULD NOT BUY AN INFRINGING PHONE
WOULD HAVE, INSTEAD, PURCHASED AN APPLE PRODUCT.
10
WE WILL PRESENT EVIDENCE TO YOU THAT IT
AND IF YOU BELIEVE THAT, YOU WILL HEAR THAT WE'RE ENTITLED
11
TO RECOVER LOST PROFITS ON THE SALES AND WE WILL PRESENT THAT
12
NUMBER TO YOU.
13
SAMSUNG IS GOING TO TELL YOU THAT NOT ONE, I'M NOT
14
EXAGGERATING HERE, THEY'RE GOING TO TELL YOU THAT NOT ONE OF
15
THOSE 37, OVER 37 MILLION BUYERS WOULD NOT HAVE BOUGHT AN APPLE
16
PRODUCT, EVEN IF THEY COULDN'T GET THEIR SAMSUNG PRODUCT.
17
18
FRANKLY, WE THOUGHT WE WERE BEING CONSERVATIVE BECAUSE OUR

EXPERT IS GOING TO TELL YOU IT'S A NUMBER UNDER 10 PERCENT.
19
BUT SAMSUNG SAYS NOT ONE.
NOT ONE.
20
THIS IS GOING TO BE ANOTHER SITUATION WHERE WHAT SAMSUNG
21
TELLS YOU HERE WILL NOT MATCH WHAT YOU SEE IN THEIR INTERNAL
22
DOCUMENTS.
23
THIS IS A DOCUMENT THAT WAS CREATED BY -- YOU HEARD ONE OF THE
24
SUBSIDIARIES, SAMSUNG TELECOMMUNICATIONS AMERICA.
25
CALLED "2011 SUMMARY AND LESSONS LEARNED" AND A BUSINESS
FOR EXAMPLE, YOU'LL SEE PLAINTIFF'S EXHIBIT 154.
IT WAS
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2
FORECAST FOR 2012.

AND ON PAGE 7 WHAT THEY TELL US, THEIR "HIGH LEVEL
INITIATIVES - BEAT APPLE."
ONE PRIORITY (EVERYTHING MUST BE IN THE CONTEXT OF BEATING
APPLE.)"
THEY SAY "BEATING APPLE IS A NUMBER
AND THEY SAY "THE THREAT FROM APPLE IS EXTREMELY REAL AND
URGENT, UP TO A 12.5 MILLION SELLING IN THE FOURTH QUARTER
VENDOR."
AND IN THE NEXT YEAR, IN A TOP SECRET REPORT FROM SAMSUNG
10
TELECOMMUNICATIONS AMERICA BACK TO HEADQUARTERS, YOU'LL SEE
11
THIS DOCUMENT WHERE THEY TALK ABOUT A PARADIGM SHIFT, AND
12
YOU'LL SEE PAGE 156 WHERE SAMSUNG DESCRIBED THE U.S. MARKET AS
13
"BECOMING A TWO HORSE RACE BETWEEN APPLE AND SAMSUNG."
14
DESPITE THESE INTERNAL DOCUMENTS, DESPITE CALLING IT A
15
"TWO HORSE RACE" AND DESPITE SAYING THAT THE THREAT FROM APPLE
16
IS, TO USE THEIR WORDS, "EXTREMELY URGENT AND REAL," THEY WILL
17
STAND HERE AND TELL YOU, THEIR WITNESSES WILL TELL YOU UNDER
18
OATH THAT IF THOSE 38 MILLION PHONES HADN'T BEEN ON THE MARKET,
19
NOT ONE OF THE PURCHASERS WOULD HAVE PURCHASED AN APPLE
20
PRODUCT.
21
THAT'S LOST PROFITS.
22
THE SECOND TYPE OF DAMAGES IS, FRANKLY, A LITTLE MORE
23
24
25
LESS THAN 10 PERCENT OF THE SALES.
COMPLICATED.
FOR THE SALES, FOR THE OTHER 90 PERCENT OF THIS 38 MILLION
FOR WHICH WE DO NOT GET LOST PROFITS, THE LAW SAYS, I BELIEVE
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THE JUDGE WILL INSTRUCT YOU AT THE END OF THE CASE THAT WE'RE
ENTITLED TO RECOVER -- YOU HEARD IT ON THE VIDEO -- WHAT IS
CALLED A REASONABLE ROYALTY.
AND AS THEY MENTIONED ON THE VIDEO, YOU THINK A REASONABLE
ROYALTY IS THE SAME AS RENT, YOU USE SOMEONE'S REAL PROPERTY,
YOU PAY THEM RENT.
YOU PAY THEM A REASONABLE ROYALTY.
8
9
10
IF YOU USE SOMEONE'S INTELLECTUAL PROPERTY,
SO THE CONCEPT THAT SOMEBODY WOULD PAY RENT FOR USING

THESE, THAT'S NOT HARD.
BUT THE TRICKY QUESTION IS HOW DO YOU, AS A JURY, DECIDE
11
WHAT THAT REASONABLE ROYALTY SHOULD BE.
12
REALLY IMPORTANT QUESTION.
13
14
15
AND THAT'S OBVIOUSLY A
AS SHE TOLD YOU, AT THE END OF THE TRIAL JUDGE KOH WILL
GIVE YOU THE ACTUAL INSTRUCTIONS.
BUT IN A BROAD SENSE SHE WILL TELL YOU, I BELIEVE, TO USE
16
SOMETHING WHICH IS CALLED A HYPOTHETICAL NEGOTIATION, THE
17
PROCESS BY WHICH YOU GET TO THE ROYALTY IS YOU CREATE A
18
NEGOTIATION THAT NEVER HAPPENED AND PROBABLY NEVER WOULD HAVE
19
HAPPENED IN THE REAL WORLD.
20
SO WHAT YOU DO IS YOU PUT APPLE AND SAMSUNG IN A ROOM AND
21
YOU PUT YOURSELF IN THEIR HEADS AND YOU FORCE THEM TO NEGOTIATE
22
OVER THE VALUE OF THESE FIVE PATENTS.
23
AND YOU WILL HEAR TESTIMONY AND AT THE END OF THAT
24
TESTIMONY, YOU DECIDE WHERE THEY WOULD HAVE ENDED UP IN THAT
25
NEGOTIATION, AND THAT'S THE REASONABLE ROYALTY.
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SO WE'RE GOING TO PRESENT EVIDENCE TO HELP YOU WITH THAT
PROCESS.
MR. HAUSER IS ONE OF THE WORLD'S EXPERTS IN THE AREA OF
CONDUCTING SURVEYS TO DETERMINE HOW CONSUMERS VALUE OPTIONS
THEY MAY BE GIVEN IN PARTICULAR PRODUCTS.
YOU WILL GET THE EVIDENCE OF MR. JOHN HAUSER.
IN THIS CASE, DR. HAUSER, CONDUCTING ONE OF THE SURVEYS,
IT'S CALLED A CONJOINT SURVEY, AND YOU'LL GET A LOT OF
EXPLANATION ABOUT THAT, TO DETERMINE THE DEGREE TO WHICH
CONSUMERS VALUE THE FIVE SPECIFIC FEATURES THAT WE'RE TALKING
10
11
ABOUT IN THIS CASE.

WE WILL ALSO PRESENT THE TESTIMONY OF DR. CHRIS VELLTURO.
12
DR. VELLTURO IS AN EXPERT IF IN THE FIELD OF CALCULATING
13
DAMAGES IN INTELLECTUAL PROPERTY CASES, PARTICULARLY IN THIS
14
PROCESS OF CARRYING ON A HYPOTHETICAL NEGOTIATION.
15
WHAT I WANT YOU TO UNDERSTAND NOW, SO THAT IT WILL HELP
16
YOU WITH THE EVIDENCE, IS THAT THIS NEGOTIATION WOULD HAVE
17
TAKEN PLACE IN AUGUST OF 2011.
18
DATE BECAUSE THAT'S THE DATE ON WHICH SAMSUNG FIRST INFRINGED
19
THE '647, '414, AND '959 PATENTS.
20
AND IT WOULD HAVE BEEN THAT
AND IT'S A CRITICALLY IMPORTANT DATE BECAUSE THE EVIDENCE
21
WILL BE THAT THE PHONES IN THIS CASE REPRESENTED THE SECOND
22
WAVE OF PRODUCTS THAT SAMSUNG HAD STARTED TO SELL IN THE
23
UNITED STATES.
24
APPLE HAD ALREADY SEEN THE EFFECT OF THE FIRST WAVE, AND
25
APPLE HAD FIGURED OUT SAMSUNG'S STRATEGY OF COPYING THE IPHONE
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2
AND SELLING ITS OWN COPIES AT LOWER PRICES.

SO THE EVIDENCE WILL BE THAT IN AUGUST OF 2011, APPLE
WOULD HAVE BROUGHT THE FOLLOWING KNOWLEDGE TO THE HYPOTHETICAL
NEGOTIATION:
ADOPTED A STRATEGY OF COPYING ITS PRODUCTS; IT WOULD HAVE KNOWN
THAT SAMSUNG WAS UNDERSELLING IT IN THE MARKETPLACE; IT WOULD
HAVE KNOWN THAT LARGE NUMBERS OF CONSUMERS WERE PLANNING, IN
THAT YEAR AND THE YEAR FOLLOWING, TO MAKE THEIR FIRST PURCHASE
OF A SMARTPHONE; AND APPLE WOULD HAVE BELIEVED, FROM WHAT IT
IT WOULD HAVE BEEN FULLY AWARE THAT SAMSUNG HAD
10
HAD SEEN, THAT SAMSUNG DID NOT HAVE THE ABILITY TO CREATE ITS
11
OWN DESIGNS THAT COULD HAVE COMPETED.
12
AND ON THE OTHER SIDE OF THAT NEGOTIATING TABLE WILL BE
13
SAMSUNG.
14
AUGUST 2011 BECAUSE YOU WILL HAVE SEEN THEIR INTERNAL
15
DOCUMENTS.
16
YOU WILL KNOW WHAT THEY WOULD HAVE BEEN THINKING IN
THEY WOULD HAVE BEEN DEEPLY AWARE OF THEIR OWN CRISIS OF
17
DESIGN; THEY WOULD HAVE KNOWN FROM THE DOCUMENT I SHOWED YOU,
18
AND ABOUT FIVE OTHERS THAT YOU'RE GOING TO SEE, THAT THE
19
DESIGNERS FELT THAT THEY HAD TO HAVE THESE FIVE SPECIFIC
20
FEATURES IN ORDER TO BE ABLE TO COMPETE AGAINST APPLE; AND THEY
21
WOULD HAVE BEEN THINKING THAT COMPETING AGAINST APPLE WAS THEIR
22
NUMBER 1 PRIORITY.
23
SO UNDER THESE CIRCUMSTANCES, IN THIS NEGOTIATING ROOM, WE
24
THINK YOU WILL AGREE THAT SAMSUNG WOULD NOT HAVE BEEN -- THAT
25
APPLE WOULD NOT HAVE BEEN WILLING TO LICENSE THESE PATENTS
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2
CHEAPLY, IF IT WOULD HAVE BEEN WILLING TO LICENSE THEM AT ALL.

DR. VELLTURO WILL GIVE YOU MUCH MORE DETAIL ABOUT THIS,
BUT HE'LL EXPLAIN TO YOU THAT IN HIS OPINION UNDER THESE
CIRCUMSTANCES APPLE WOULD HAVE ASKED FOR AN AVERAGE ROYALTY OF
ABOUT $33 PER PHONE, $40 AT THE TOP END FOR EVERY PHONE THAT
INFRINGED ALL FIVE OF THE PATENTS.
GIVEN THE YEARS OF RESEARCH, GIVEN THE RISK THAT APPLE HAD
TAKEN, GIVEN THE SUCCESS OF THESE FEATURES IN THE MARKETPLACE,
AND GIVEN THE IMPORTANCE OF THE IPHONE TO APPLE'S SUCCESS,
10
APPLE WOULD NOT HAVE AGREED TO LICENSE THESE PATENTS TO THIS
11
COMPANY FOR LESS.
12
BUT BECAUSE YOU'RE GOING TO BE MULTIPLYING THIS AVERAGE
13
TIMES MILLIONS AND MILLIONS OF INFRINGING PHONES, YOU PROBABLY
14
HAVE ALREADY RECOGNIZED BUT YOU WILL CERTAINLY GET THERE, THAT
15
ALTHOUGH THE ROYALTY PER PHONE IS REASONABLE, THE TOTAL DAMAGES
16
THAT WE'RE GOING TO ASK YOU TO AWARD IS HIGH.
17
BILLION.
18
IT'S OVER $2
BUT I HOPE AT THE END OF THE TRIAL YOU WILL UNDERSTAND
19
THAT THE REASON THAT THE DAMAGES IN THIS CASE ARE HIGH IS
20
BECAUSE THE SCOPE OF SAMSUNG'S INFRINGEMENT HAS BEEN MASSIVE.
21
IT IS NOT A SECRET THAT APPLE IS PROUD OF ITS INTELLECTUAL
22
PROPERTY.
IT'S NOT A SECRET THAT IT WAS THE ABILITY OF APPLE'S
23
DESIGNERS AND ENGINEERS TO CREATE AND INVENT THAT HAS BEEN
24
RESPONSIBLE FOR MAKING APPLE, WHAT CAN BE CALLED YESTERDAY THE
25
BIG COMPANY, THE SUCCESSFUL COMPANY, THE WEALTHY COMPANY THAT
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IT IS TODAY, THAT WAS NOT A FOREORDAINED CONCLUSION.
THEY GOT
THERE THROUGH HARD WORK, THROUGH INTRODUCING PRODUCTS THAT THE
WORLD HAD NOT SEEN, AND BY BEING RIGHT IN THEIR DESIGN CHOICES.
AND IT WILL NOT BE A SECRET, AFTER YOU'VE HEARD THE
EVIDENCE, THAT APPLE HAS BEEN HURT VERY, VERY BADLY BY THE
INFRINGEMENT STRATEGY THAT SAMSUNG INTENTIONALLY ADOPTED IN
THIS CASE AND WHICH IT HAS USED SO EFFECTIVELY TO CARVE OUT ITS
CURRENT PLACE IN THE MARKETPLACE.
I SPENT A MINUTE LAYING OUT FOR YOU WHAT SAMSUNG WAS GOING
10
TO SAY IN THIS CASE, BUT I LEFT OUT ONE PARTICULARLY CYNICAL
11
ARGUMENT THAT THEY INTEND TO MAKE, AND FOR A PREVIEW OF THAT
12
ARGUMENT, I'M GOING TO GIVE YOU BACK TO MY GOOD FRIEND
13
BILL LEE.
14
15
THE COURT:
MR. LEE:
17
THE COURT:
18
MR. LEE:
20
YOU HAVE
22 MINUTES.
YES.
(MR. LEE GAVE HIS OPENING STATEMENT ON BEHALF OF

PLAINTIFF.)
21
MR. LEE:
22
TO SEE YOU AGAIN.
23
TIME IS 11:27.
UNTIL 11:49.
16
19
ALL RIGHT.
GOOD MORNING, LADIES AND GENTLEMEN.
GOOD
MR. MCELHINNY HAS JUST DISCUSSED WITH YOU THE EVIDENCE
24
THAT WILL DEMONSTRATE THAT IT WAS APPLE THAT INVESTED,
25
INNOVATED AND TOOK THE RISK OF BRINGING TO MARKET REVOLUTIONARY
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PRODUCTS, PRODUCTS THAT HAVE CHANGED THE WAY THAT WE
COMMUNICATE WITH EACH OTHER ON A DAILY BASIS.
HE HAS ALSO DESCRIBED TO YOU THE EVIDENCE THAT
DEMONSTRATES THAT SAMSUNG NOT ONLY INFRINGED ON APPLE'S
INTELLECTUAL PROPERTY, BUT INTENTIONALLY COPIED THAT
INTELLECTUAL PROPERTY TO GAIN A POSITION IN THE MARKETPLACE.
BUT AS HER HONOR EXPLAINED TO YOU, SAMSUNG HAS ALSO
ASSERTED TWO PATENTS AGAINST APPLE.
OPENING, IN LESS THAN 22 MINUTES, I'M GOING TO DESCRIBE TO YOU
10
11
12
13
14
15
16
17
IN MY PORTION OF THE
THOSE CLAIMS AGAINST APPLE.

AND LET ME BEGIN BY TELLING YOU A LITTLE BIT ABOUT THE
THOSE PATENTS.
IN A FEW MINUTES, WE ANTICIPATE THAT SAMSUNG WILL TELL YOU
THAT IT INVESTS ENORMOUS AMOUNTS IN RESEARCH AND DEVELOPMENT.
WE EXPECT THAT THEY'LL TELL YOU THAT THEY HAVE TENS OF
THOUSANDS OF PATENTS.
BUT, LADIES AND GENTLEMEN, YOU WILL NOT HEAR ABOUT ONE OF
18
THOSE PATENTS HERE.
19
RESULTED FROM THE WORK OF ANY SAMSUNG ENGINEER.
20
21
22
YOU WILL NOT HEAR ABOUT ONE PATENT THAT
YOU WILL NOT HEAR OF ONE PATENT THAT RESULTED FROM ANY
WORK, ANY INNOVATION THAT SAMSUNG DID BY ITSELF.
AND WHY?
BECAUSE FOR SMARTPHONES AND TABLETS, IT WAS
23
APPLE THAT WAS THE INVENTOR, THE INNOVATOR.
24
SAMSUNG THAT WAS THE INTENTIONAL FOLLOWER.
25
LATER IT WAS
INSTEAD WHAT THE EVIDENCE WILL DEMONSTRATE TO YOU IS THIS:
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IN AUGUST OF 2010, APPLE MET WITH SAMSUNG.
AS
MR. MCELHINNY HAS SAID, APPLE KNEW THAT SAMSUNG WAS COPYING.
IT ASKED TO MEET WITH SAMSUNG.
4
5
6
7
8
9
10
11
12
AND IT SAID TO SAMSUNG, "YOU ARE COPYING OUR PRODUCTS,

YOU'RE INFRINGING OUR PATENTS.
STOP."
WE DIDN'T RUN OFF TO COURT.
WE DID WHAT GROWNUPS SHOULD
DO AND ASKED TO MEET AND SAID "WOULD YOU STOP?"

BUT SAMSUNG DIDN'T STOP COPYING.
AS YOU WILL LEARN, THEY
DIDN'T STOP INFRINGING.

INSTEAD, THEY KEPT ON DOING WHAT THEY HAD BEEN DOING,
INTENTIONAL COPYING AS YOU'VE NOW SEEN FROM INTERNAL DOCUMENTS.
AND THEY DID TWO OTHER THINGS.
HAVING BEEN ACCUSED OF
13
INFRINGING AND COPYING, THEY WENT OUT AND BOUGHT TWO PATENTS,
14
TWO PATENTS AFTER THEY'D BEEN ACCUSED OF INFRINGING.
15
THE TWO PATENTS THAT YOU'RE GOING TO HEAR ABOUT HERE, ONE
16
CALLED THE '449 PATENT, ONE CALLED THE '239 PATENT, BOTH
17
PURCHASED BY SAMSUNG FROM SOMEBODY ELSE AFTER APPLE HAD SAID
18
"PLEASE STOP COPYING."
19
20
21
22
THOSE ARE
THESE ARE THE PATENTS THAT SAMSUNG WILL ASSERT, NOT

PATENTS THAT COME FROM ITS OWN WORK.
NOW, AT THIS TRIAL YOU WILL NOT HEAR APPLE ARGUE, AS HER
HONOR HAS SAID, THAT THESE TWO PATENTS ARE INVALID.
23
AS YOU LEARNED FROM THE VIDEO FROM THE FEDERAL JUDICIAL
24
CENTER, THERE'S AN APPLICATION PROCESS WHERE EXAMINERS INVEST
25
ENORMOUS AMOUNTS OF TIME IN REVIEWING THE APPLICATIONS FOR THE
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PATENTS.
APPLE IS NOT GOING TO COME HERE AND SAY FOR THESE TWO
PATENTS THAT SAMSUNG PURCHASED FROM A THIRD PARTY WHO
PROSECUTED THE PATENTS THAT THE PATENT OFFICE MADE A MISTAKE.
WE'RE NOT GOING TO SAY THAT.
ONLY SAMSUNG IS GOING TO TELL YOU THAT THE PATENT OFFICE
MADE A MISTAKE.
ONLY SAMSUNG IS GOING TO TELL YOU THEY MADE A
MISTAKE FIVE TIMES.
THEY MADE A MISTAKE EVERY SINGLE TIME RELEVANT TO THIS CASE.
ONLY SAMSUNG IS GOING TO TELL YOU THAT
10
WHAT YOU WILL LEARN IS THE TWO PATENTS THAT SAMSUNG
11
ASSERTS HERE, IN FACT, DESCRIBE TECHNOLOGY THAT IS VERY OLD AND
12
VERY OBSOLETE.
13
IN FACT, ONE OF THESE PATENTS IS SO OLD THAT IT'S EXPIRED.
14
DO YOU REMEMBER ON THE VIDEO TODAY WHEN THEY TOLD YOU THAT A
15
PATENT HAS A TERM FOR 20 OR 17 YEARS?
16
THE 20 YEARS IS OVER.
17
18
FOR ONE OF THOSE PATENTS
WHY THEN DID SAMSUNG -- WHY THEN IS SAMSUNG ASSERTING

THESE PATENTS AGAINST APPLE?
19
WELL, LET ME BEGIN WITH TWO REASONS THAT IT IS NOT.
20
THE EVIDENCE WILL DEMONSTRATE TO YOU THAT IT'S NOT BECAUSE
21
SAMSUNG THOUGHT THESE PATENTS DESCRIBED IMPORTANT INVENTIONS.
22
YOU WILL SEE NO SAMSUNG DOCUMENT THAT SAYS SO.
23
24
25
THE LAWYERS MAY TELL YOU SOMETHING DIFFERENT TODAY, BUT

YOU WON'T SEE ANYTHING FROM SAMSUNG.
AND THE EVIDENCE WILL DEMONSTRATE THAT APPLE'S PRODUCTS,
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THE RESULTS OF ITS INNOVATIONS AND INVENTIONS, ARE, IN FACT,
VERY, VERY DIFFERENT FROM THESE OLD TECHNOLOGIES.
YOU WILL LEARN, AND YOU WILL HEAR FROM THE PEOPLE WHO DID
THIS, THAT APPLE'S ENGINEERS INVESTED ENORMOUS AMOUNTS OF TIME
AND EFFORT TO DEVELOP THE PRODUCTS THAT SAMSUNG ACCUSES OF
INFRINGING.
YOU WILL LEARN, LADIES AND GENTLEMEN, THAT THERE IS NOT A
SINGLE PIECE OF EVIDENCE, NOT A SINGLE SHRED OF EVIDENCE, THAT
APPLE COPIED THESE PATENTS.
10
IN FACT, YOU WILL LEARN THAT THE PEOPLE WHO DID THE WORK
11
FOR APPLE DIDN'T EVEN KNOW ABOUT THESE PATENTS WHEN THEY
12
DESIGNED THE PRODUCTS THAT NOW HAVE BEEN ACCUSED OF
13
INFRINGEMENT.
14
15
16
AND WE'LL ASK YOU AT THE END OF THE CASE TO COMPARE THAT
TO WHAT YOU'VE SEEN FROM SAMSUNG.
SO WHY THEN DOES SAMSUNG ASSERT THESE PATENTS?
THE
17
ANSWER, THE EVIDENCE WILL DEMONSTRATE, IS IN THE DAMAGE CLAIM
18
THAT SAMSUNG IS GOING TO OFFER YOU FOR THESE TWO PURCHASED
19
PATENTS.
20
21
22
23
FOR THE '239 PATENT, THE PATENT THAT'S EXPIRED, THEY'RE

ASKING YOU FOR AROUND $6 MILLION.
FOR THE '449 PATENT, THE PATENT THAT HASN'T EXPIRED,
THEY'RE GOING TO ASK YOU FOR $158,000.
24
YOU WILL LEARN FROM THE EVIDENCE THAT THEY'VE HIRED
25
MULTIPLE EXPERTS TO COME AND SIT IN THAT STAND AND TALK TO YOU
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ABOUT THIS PATENT, AND THEY'VE PAID THEM MORE THAN THE AMOUNT
OF MONEY THAT THEY'RE ASKING FOR IN DAMAGES.
WHY WOULD THEY DO THAT?
HERE'S WHAT THE EVIDENCE WILL SHOW:
THE EVIDENCE WILL
SHOW THAT THEY PURCHASED THESE PATENTS THAT THEY'RE ASSERTING
WITH LOW DAMAGES CLAIMS BECAUSE THEY WANT YOU TO BELIEVE THAT
PATENTS DON'T HAVE MUCH VALUE.
PATENTS ARE NOT WORTH MUCH.
THEY WANT YOU TO BELIEVE THAT
THEY ARE HOPING THAT WHEN YOU TURN THE 37 MILLION ACTS OF
10
INFRINGEMENT, THAT YOU'LL COMPROMISE BECAUSE THE PATENTS ARE
11
NOT WORTH MUCH.
12
THAT IS WHAT THE INFRINGER, THAT IS WHAT THE FOLLOWER,
13
THAT IS WHAT THE COPIER WANTS YOU TO BELIEVE.
14
WORTH MUCH.
15
BUT THE INNOVATORS KNOW BETTER.
PATENTS ARE NOT
THEY KNOW THE RISK THEY
16
TOOK.
17
HOW DIFFICULT IT IS TO COME UP WITH AN IDEA TO MAKE A PRODUCT
18
BETTER.
19
THEY KNOW THE INVESTMENT OF TIME THEY MADE.
THEY KNOW
THEY KNOW WHAT AN INVENTION IS, AND THEY KNOW WHAT THE
20
VALUE OF A PATENT THAT REALLY IS THE RESULT OF HARD WORKING
21
INVENTIONS.
22
LAWYERS TO PATENTS PURCHASED FROM OTHERS.
23
24
25
IN CONTRAST TO THE VALUE OF THE PATENT ASSIGNED BY
SO LET ME QUICKLY TELL YOU ABOUT THE TWO PATENTS.
THE
FIRST ONE IS CALLED THE '449 PATENT, AS I SAID.

YOU WILL HEAR FROM AN APPLE ENGINEER TIMED TIM MILLET,
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WHO'S ON THE LEFT-HAND SIDE OF THE SCREEN THERE, AND HE'S GOING
TO EXPLAIN TO YOU THE VERY DIFFERENT AND NEW HARDWARE
COMPONENTS IN APPLE'S PRODUCTS AND HOW THOSE COMPONENTS WORK.
YOU WILL ALSO HEAR FROM PROFESSOR JAMES STORER FROM
BRANDEIS UNIVERSITY IN BOSTON, A RECOGNIZED EXPERT IN THE FIELD
OF VIDEO COMPRESSION, AND HE, TOO, WILL EXPLAIN TO YOU HOW THE
NEW TECHNOLOGIES IN THE APPLE PRODUCTS HAVE NOTHING TO DO WITH
THE OLD TECHNOLOGIES OF THE '449 PATENT.
9
10
11
12
13
LET ME GIVE YOU A QUICK EXAMPLE.
I'M GOING TO PUT ON THE
SCREEN CLAIMS 25 AND 27 OF THE '449 PATENT.

WE'RE NOT GOING TO GO THROUGH IT ALL NOW.
AS
MR. MCELHINNY SAID, THE CLAIMS ARE WHAT ARE IMPORTANT.

CLAIMS 25 AND 27 TELL YOU WHAT THE INVENTION OF THE '449
14
PATENT IS, AND YOU WILL SEE IT HAS NOTHING TO DO WITH
15
SMARTPHONES.
16
HAS NOTHING TO DO WITH A MOBILE DEVICE.
17
18
IT HAS NOTHING TO DO WITH A TABLET COMPUTER.
IT
INSTEAD IT DESCRIBES A DIGITAL CAMERA USING OLDER HARDWARE

COMPONENTS, COMPONENTS THAT ARE NOT NECESSARY ANY LONGER TODAY.
19
SO LET ME GIVE YOU AN EXAMPLE.
20
ONE OF THE SPECIFIC REQUIREMENTS OF THE '449 PATENT IS
21
THAT IT THE DIGITAL CAMERA DISPLAY A LIST, AND THAT THAT LIST
22
BE IN A SEARCHABLE FORM.
23
THEY EVEN GAVE AN EXAMPLE OF WHAT THE LIST WOULD LOOK
24
LIKE, AND THAT IS FIGURE 7 OF THE PATENT, WHICH IS ON THE
25
SCREEN NOW.
IT IS A LIST OF THE PHOTOS YOU'VE TAKEN.
IT IS IN
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A FORM THAT CAN BE SEARCHED.
THEY DID IT BECAUSE THE TECHNOLOGY OF THAT DAY WOULDN'T
ALLOW YOU TO DISPLAY ALL OF THE PHOTOS YOU HAD TAKEN IN A WAY
WHERE YOU COULD SIMPLY LOOK AT THEM AND SCROLL THROUGH THEM.
5
6
BUT THAT'S NOT WHAT THE IPHONE OR THE IPAD DO.

NO LIST.
THERE IS
THERE IS NO SEARCH MODE.
INSTEAD, THE APPLE -- APPLE'S INVENTORS CAME UP WITH
SOMETHING CALLED THE CAMERA ROLL, AND I'M GOING TO PUT THE
CAMERA ROLL ON THE SCREEN RIGHT NOW ON THE LEFT-HAND SIDE.
10
USING MODERN TECHNOLOGY AND NEW INNOVATIONS, THE APPLE
11
TECHNOLOGY SIMPLY ALLOWS YOU TO PUT THUMBNAILS OF THE PHOTOS IN
12
A GRID FORMAT WHERE YOU CAN SIMPLY SCROLL THROUGH THEM.
13
DON'T NEED A LIST.
14
THE PHOTO.
15
THROUGH THE PHOTOS.
16
YOU DON'T HAVE TO GO TO THE LIST TO FIND
YOU DON'T NEED TO SEARCH IT.
AND I'VE PUT IT ON THE RIGHT.
18
SEARCHES FOR WORDS.
19
YOUR CONTACTS.
21
22
23
24
25
YOU JUST SCROLL
NOW, THE APPLE PHONES ACTUALLY DO HAVE A SEARCH FEATURE,
17
20
YOU
WHY?
BUT THAT SEARCH FEATURE ONLY
IT SEARCHES YOUR E-MAILS.
IT SEARCHES
IT DOESN'T SEARCH PHOTOS OR VIDEOS.
BECAUSE THE NEWER AND MODERN TECHNOLOGY OF THE APPLE
PRODUCTS, OF THE APPLE CAMERA ROLL, DOESN'T REQUIRE IT.

NOW, LET ME MAKE ONE MORE POINT ABOUT THE '449 PATENT THAT
I'LL ASK YOU TO KEEP IN MIND.
YOU WILL LEARN THAT SAMSUNG ACTUALLY SELLS PRODUCTS TO
APPLE FOR INCLUSION IN THE IPHONE AND THE IPAD, COMPONENTS.
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YOU WILL LEARN THAT IT ACTUALLY SUPPLIES TWO OF THE
COMPONENTS THAT IT'S NOW ACCUSING OF INFRINGING.
SO LET ME PAUSE ON THAT FOR A SECOND.
SINCE 2010, SAMSUNG
HAS BEEN SELLING AND MAKING BILLIONS OF DOLLARS SELLING
COMPONENTS TO APPLE.
COMPONENTS.
DID IT SAY, "WE'RE SELLING YOU THESE COMPONENTS, BUT YOU OUGHT
TO KNOW THERE'S A PATENT OUT THERE THAT'S GOING TO BE A
PROBLEM."
10
SINCE 2010, IT'S BEEN SELLING THESE TWO
NEVER ONCE, BEFORE IT WAS ASKED TO STOP COPYING,
NEVER ONCE.
BUT THEN AFTER APPLE SAID, "WOULD YOU PLEASE STOP
11
COPYING," SAMSUNG SAID, "WE HAVE THIS PATENT.
12
THE COMPONENTS YOU'RE BUYING FROM US ARE NOW INFRINGING IT, AND
13
WE'D LIKE YOU TO PAY US."
14
15
WE PURCHASED IT.
THAT IS A QUESTION WE WILL ASK YOU TO BRING YOUR COMMON

SENSE TO BEAR ON WHEN YOU DECIDE THE CASE.
16
LET ME TURN QUICKLY TO THE OTHER PATENT, THE '239 PATENT.
17
THIS IS A PATENT WHERE SAMSUNG CLAIMS THAT THREE FEATURES
18
IN APPLE'S IPHONE, MAIL, MESSAGES, FACETIME, INFRINGE.
19
OF YOU MAY HAVE SEEN ON TV, SOME OF YOU ON YOUR OWN PHONES,
20
THAT ALLOWS YOU TO SEND E-MAIL, SEND TEXT MESSAGES, AND DO A
21
TWO-WAY VIDEO CALL ON FACETIME.
22
AS MANY
AGAIN, YOU'RE GOING TO HEAR FROM THE FOLKS WHO DESIGNED
23
THESE PRODUCTS AND MADE THESE INNOVATIONS.
YOU'LL HEAR FROM
24
TIM MILLET, WHO I'VE IDENTIFIED PREVIOUSLY, BUT YOU'LL ALSO
25
HEAR FROM ROBERTO GARCIA, WHO'S IN THE MIDDLE.
HE IS AN
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ENGINEER WHO HELPED DEVELOP AND WILL DESCRIBE THE TIME AND
EFFORT AND INNOVATION THAT WENT INTO FACETIME.
3
4
PROFESSOR STORER WILL AGAIN TELL YOU JUST HOW DIFFERENT

THEY ARE.
LET ME EXPLAIN VERY QUICKLY HOW DIFFERENT THEY ARE.
THE '239 PATENT YOU WILL SEE DOES NOT DESCRIBE A
SMARTPHONE, DOES NOT DESCRIBE A TABLET COMPUTER.
TO WHAT SAMSUNG WILL TELL YOU, IT IS NOT THE INVENTION OF
SENDING VIDEO OVER SLIDER.
10
AND CONTRARY
INSTEAD IT DESCRIBES A VERY OLD DEVICE THAT HAD -- FOR
11
CAPTURING A VIDEO THAT HAD ALREADY BEEN TAKEN SOMEWHERE ELSE.
12
THIS IS AN INVENTION OF THE VCR BETAMAX DAYS IF ANY OF YOU ARE
13
AS OLD AS I AM AND CAN REMEMBER, RIGHT?
14
15
SOMEBODY ELSE HAS TO CAPTURE THE VIDEO.
YOU HAVE TO TAKE
THE VIDEO, THEN YOU HAVE TO CAPTURE IT.
16
THAT'S WHY, WHEN YOU LOOK AT THE CLAIMS AGAIN, AND I'LL
17
PUT THE CLAIM ON THE SCREEN, THIS CLAIM REQUIRES SOMETHING
18
CALLED A VIDEO CAPTURE MODULE.
19
SAMSUNG CLAIMS WE INFRINGE.
20
THIS IS IN CLAIM 15, WHICH
BUT WHAT YOU WILL LEARN IS THIS PATENT CAME INTO BEING AT
21
A TIME WHEN VIDEO WAS ANALOG, NOT DIGITAL, AND THE ONLY WAY TO
22
GET IT INTO A DIGITAL COMPUTER WAS TO HAVE SOMEONE TAKE IT,
23
RECORD IT, AND THEN CAPTURE IT ON THAT COMPUTER IN DIGITAL
24
FORM.
25
YOU WON'T HAVE TO GUESS AT IT BECAUSE THAT'S EXACTLY WHAT
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THE PATENT DESCRIBES, AND I'M GOING TO SHOW YOU FIGURE 1 FROM
THE PATENT.
NOW, THE FOCUS OF CLAIM 15 IS THE GREEN REMOTE UNIT, AND
I'M GOING TO FOCUS ON THAT.
IS THE VIDEO IS TAKEN FIRST BY THE VIDEO CAMERA, AND THEN IT'S
CAPTURED BY THE REMOTE UNIT, SOMETHING THAT YOU HAD TO DO 20
YEARS AGO, SOMETHING THAT YOU DON'T HAVE TO DO TODAY.
8
9
10
BUT WHAT THE PATENT WILL TELL YOU
YOU WILL LEARN THAT THE INVENTORS ACTUALLY BUILT A

COMMERCIAL PRODUCT USING THE '239 PATENT.
NOW, AT THE TIME THIS WAS SOMETHING THAT WAS INTERESTING
11
AND SIGNIFICANT.
12
VCR'S, AND THEY GOT AWARDS FOR IT, AND THIS IS THE PRODUCT THAT
13
THEY PUT ON THE MARKETPLACE.
14
IT WAS USEFUL IN THE ERA OF BETAMAXES AND
IT IMPROVED THE LAPTOP THROUGH CELLULAR MODEMS AND THROUGH
15
CELL PHONES.
16
TRANSMIT A 15 SECOND VIDEO CLIP.
17
IT WEIGHED 28 POUNDS AND TOOK 16 MINUTES TO
BUT YOU WILL LEARN THAT THE IPHONE AND THE IPAD DON'T NEED
18
A VIDEO CAPTURE MODULE.
19
CAPTURING VIDEO TAKEN SOMEWHERE ELSE.
20
THE IPAD CAPTURE THE VIDEO, RECORD THE VIDEO THEMSELVES.
21
THERE'S NO NEED TO RECORD IT SOMEWHERE ELSE AND THEN CAPTURE IT
22
IN THE IPAD OR THE IPHONE.
23
THEY DON'T NEED IT BECAUSE THEY'RE NOT

IN FACT, THE IPHONE AND
FOR THAT REASON THE TECHNOLOGY IS FUNDAMENTALLY DIFFERENT.
24
THEY'RE OF DIFFERENT TIMES.
AND THE OLDER HARDWARE AND THE
25
OLDER TECHNOLOGY OF THIS PATENT IS SIMPLY NOT USED.
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SO LET ME RETURN -- WE'RE CLOSE TO THE END OF OUR
OPENING -- TO THE CHRONOLOGY THAT MR. MCELHINNY STARTED WITH
YOU ON.
RISK THAT APPLE TOOK.
HE STARTED WITH YOU ON THE YEARS OF INVESTMENT AND THE
HE TOLD YOU ABOUT -- AND IT'S HARD TO REMEMBER TODAY --
ABOUT THE ENORMOUS RISK THAT APPLE TOOK AS A COMPANY, BUT ALSO
AS PEOPLE, AND YOU WILL HEAR FROM SOME OF THESE PEOPLE, TO
BRING TO THE WORLD DEVICES THAT WOULD FUNDAMENTALLY
REVOLUTIONIZE COMMUNICATIONS.
10
11
THEY DID NOT KNOW WHETHER THEY WOULD BE A SUCCESS OR A

FAILURE.
THEY ONLY KNEW THAT THEY WERE TAKING A RISK.
12
BUT THAT RISK PAID OFF.
13
YOU NOW KNOW THAT AFTER STEVE JOBS INTRODUCED THE IPHONE,
14
IT BECAME THE INVENTION OF THE YEAR.
15
16
IT'S PAID OFF WELL.
AND WE KNOW THAT APPLE DID IT AGAIN WHEN APPLE INTRODUCED

THE IPAD THREE YEARS LATER.
17
IT, TOO, WAS AN ENORMOUS SUCCESS.
NOW, FOCUS ON THE TWO CLAIMS, THE TWO PATENTS THAT THEY'RE
18
NOW ASSERTING AGAINST US.
19
DOCUMENTS THAT MR. MCELHINNY WAS SHOWING TO YOU WERE BEING
20
GENERATED, SAMSUNG SAID, OH, BY THE WAY, YOU'RE INFRINGING SOME
21
PATENTS.
22
THERE THAT YOU'RE INFRINGING FOR THE IPHONE?
23
IPAD?
24
25
WHEN THIS STARTED, WHEN ALL THESE
HEY, YOU OUGHT TO STOP.
NO.
FOR THE IPOD TOUCH?
THERE ARE SOME PATENTS OUT

NO.
FOR THE
NO.
NOW, AT THAT MOMENT IN TIME, IN 2010, APPLE AND SAMSUNG

HAD A MAJOR BUSINESS RELATIONSHIP.
THEY STILL DO TODAY.
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BUT APPLE'S INTELLECTUAL PROPERTY IS SO IMPORTANT THEY
COULD NOT STAND BY AND JUST LET SOMEONE TAKE IT.
IT COULD NOT
STAND BY WITHOUT RAISING ITS HAND AND SAYING, "STOP.
TO STOP."
YOU NEED
EVEN FOR ITS BUSINESS PARTNER, IT SAID, "PLEASE STOP."
AT THAT POINT IN TIME SAMSUNG HAD TWO CHOICES.
IT COULD DO WHAT A GOOD BUSINESS PARTNER WOULD DO AND IT
8
9
COULD HAVE STOPPED.

IT COULD HAVE INVESTED ITS OWN MONEY IN INVENTION AND
10
INNOVATION AND IT COULD HAVE COME OUT WITH ITS OWN PRODUCTS,
11
WITH ITS OWN INVENTIONS AND INNOVATIONS.
12
OR IT COULD HAVE REFUSED TO STOP COPYING.
IT COULD HAVE
13
CONTINUED TO BRING INFRINGING PHONES TO MARKET 37 MILLION
14
TIMES, AND IT COULD HAVE GONE OUT AND BOUGHT TWO PATENTS AND
15
SAID "YOU NOW INFRINGE.
16
MONEY BECAUSE THE PATENTS AREN'T WORTH A WHOLE LOT."
17
BUT WE'RE NOT GOING TO ASK FOR MUCH
NOW, WE ARE AT THE END OF OUR OPENING.
I WANT TO END
18
WHERE MR. MCELHINNY STARTED, BY THANKING YOU FOR YOUR TIME AND
19
ATTENTION ON BEHALF OF MR. MCELHINNY, ME, OUR COLLEAGUES, BUT
20
MOST OF ALL, BY APPLE AND THE EMPLOYEES AND THE INVENTORS AT
21
APPLE.
22
OVER THE NEXT FEW WEEKS, WE'LL BE ASKING YOU TO LISTEN
23
CAREFULLY TO A LOT OF EVIDENCE AND EVIDENCE THAT BEARS ON THE
24
ISSUE THAT HER HONOR INSTRUCTED YOU ON TODAY.
25
AT TIMES, IT WILL SEEM LIKE YOU'RE DRINKING WATER FROM A
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2
3
4
5
FIREHOSE.
BUT IF WE DO OUR JOB, WE WILL MAKE THAT TECHNOLOGY AND
THAT EVIDENCE UNDERSTANDABLE TO YOU.
IF WE DO OUR JOB, YOU WILL KNOW WHO THE TRUE INVENTORS AND
INNOVATORS ARE.
IF WE DO OUR JOB, YOU WILL KNOW WHO THE COPIER IS.
IF WE DO OUR JOB, YOU WILL KNOW WHO THE INFRINGER IS.
AND, LADIES AND GENTLEMEN, IF WE DO OUR JOB AND WE FOCUS
YOU ON THE RISK THAT APPLE TOOK TO REVOLUTIONIZE THE WORLD, WE
10
WILL BRING YOU THE EVIDENCE TO DETERMINE WHAT PATENTS AND
11
INNOVATION ARE REALLY WORTH.
12
THANK YOU.
13
14
THE COURT:
NOON.
OKAY?
OKAY.
TIME IS NOW 11:46.
THANK YOU.
15
MR. QUINN:
OKAY.
16
THE COURT:
11:47.
17
MR. QUINN:
18
19
OPENING.
GO AHEAD, PLEASE.
(MR. QUINN GAVE HIS OPENING STATEMENT ON BEHALF OF

DEFENDANTS.)
MR. QUINN:
20
21
WE'LL STOP AT
WOW.
GOOD MORNING, FOLKS.
IT'S STILL MORNING.
I CAN WONDER WHY SOME OF YOU MIGHT BE LOOKING A
22
LITTLE SIDEWAYS AT ME RIGHT NOW AFTER HEARING THAT PRESENTATION
23
OF APPLE'S CASE FROM TWO VERY SKILLED LAWYERS.
24
25
BUT DURING JURY SELECTION, YOU PROMISED US THAT YOU'D KEEP

AN OPEN MIND UNTIL YOU HEARD ALL THE EVIDENCE, AND I'M SURE
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THAT YOU APPRECIATE THAT YOU'VE ONLY HEARD A SMALL PART OF THE
STORY AT THIS POINT.
SO I'D LIKE TO TALK TO YOU ABOUT SOME IMPORTANT FACTS THAT
NEITHER MR. MCELHINNY NOR MR. LEE SPOKE ABOUT IN THEIR
STATEMENTS TO YOU.
BEFORE I SIT DOWN, I'M GOING TO PROVE TO YOU, DURING THE
COURSE OF THIS TRIAL, WE WILL PROVE TO YOU THAT, YES, APPLE IS
A GREAT COMPANY, BUT THEY DON'T OWN EVERYTHING.
THE ONLY WAY TO SEARCH ON PHONES.
10
TO SYNC.
11
ON A PHONE.
12
THEY DON'T OWN
THEY DON'T OWN THE ONLY WAY
THEY DON'T OWN THE ONLY WAY TO HAVE AN UNLOCK SCREEN
WE WILL PROVE TO YOU THAT THEY VASTLY OVERSTATED THE
13
SCOPES OF THOSE PATENT CLAIMS AND THAT THEY'RE COUNTING ON YOU
14
TO BE CONFUSED AND NOT UNDERSTAND THAT, YES, INDEED, THESE ARE
15
VERY, VERY NARROW SOFTWARE CLAIMS THAT COVER ONE ABILITY, ONE
16
WAY TO DO SOMETHING THAT A LOT OF DIFFERENT COMPANIES DO
17
DIFFERENT WAYS.
18
AND WE WILL PROVE TO YOU -- RIGHT NOW I'M JUST GOING TO BE
19
BLUNT RIGHT NOW.
20
THEY FINALLY -- I WAS WAITING.
21
WOULD SAY IT TO YOU, THE "B" WORD, BILLIONS.
22
23
24
25
THEIR REQUEST, THEY FINALLY SAID THE WORD,

I WAS WONDERING WHETHER THEY
AND THEY PUT THAT NUMBER OUT THERE TO PUT IT IN YOUR HEADS
SO THAT THAT'S THE DAMAGES HORIZON THAT YOU'RE THINKING OF.
FOLKS, I'LL PROVE TO YOU IN MY OPENING STATEMENT THAT THAT
IS A GROSS, GROSS EXAGGERATION AND AN INSULT TO YOUR
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INTELLIGENCE.
AS APPLE TOLD YOU, THE IPHONE WAS INNOVATIVE BACK IN 2007.
IT WAS THE INVENTION OF THE YEAR ALL THOSE YEARS AGO BACK IN
2007.
BUT THIS CASE IS REALLY NOT ABOUT THAT IPHONE OR ANY
IPHONES THAT COME AFTER IT.
INSTRUCTED YOU, I'M SURE IT WENT PAST YOU BECAUSE IT WAS SO
QUICK, THE PRELIMINARY INSTRUCTIONS AND MR. MCELHINNY
ACKNOWLEDGED IT, APPLE ADMITS THAT THREE OF THE FIVE PATENT
10
CLAIMS THAT IT IS SUING ON WERE NOT IN THAT IPHONE AND HAVE
11
NEVER BEEN IN ANY IPHONE SINCE.
12
VALUABLE ENOUGH TO EVEN USE.
13
APPLE ADMITS, THE JUDGE HAS
APPLE DOESN'T CONSIDER IT
THERE'S A FOURTH ONE, SLIDE TO UNLOCK THAT IN THEIR LATEST
14
PRODUCTS OPERATING SYSTEM, IOS 7, THEY'VE ABANDONED ALSO.
15
WE'LL PROVE THAT TO YOU AS WELL.
16
17
18
THIS CASE REALLY IS NOT -- ALSO IT'S NOT ABOUT SAMSUNG

COPYING APPLE.
THE FEATURES THAT APPLE ACCUSES IN THIS CASE ARE ALL
19
SOFTWARE FEATURES, SOFTWARE THAT RUNS ON THE SMARTPHONES AND
20
TABLETS OF MANY, MANY COMPANIES IN THE WORLD.
21
APPLE AGREES, APPLE AGREES THAT THAT SOFTWARE AND THOSE
22
FEATURES WERE PUT ON THAT SOFTWARE -- OR THOSE FEATURES WERE
23
PUT IN THAT SOFTWARE THAT'S USED BY MANY DIFFERENT COMPANIES BY
24
ENGINEERS, SOFTWARE ENGINEERS AT ANOTHER COMPANY, NOT BY
25
SAMSUNG.
AND I'M NOT POINTING THE FINGER AS THEY'VE SAID.
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WE'LL PROVE TO YOU THAT, IN FACT, THE ENGINEERS AT THAT
OTHER COMPANY DID INDEPENDENTLY DEVELOP THOSE SOFTWARE
FEATURES, AND THEY DID NOT COPY APPLE.
LET ME SHOW YOU WHAT I MEAN.
THIS IS ONE OF THE PHONES
THAT'S ACCUSED IN THIS CASE.
CALLED THE SAMSUNG GALAXY NEXUS.
EXHIBIT 29K FOR THE RECORD.
LITTLE BIT MORE THAN TWO YEARS AGO.
IT'S A SAMSUNG PHONE.
IT'S
YOU CAN SEE THAT IT'S JOINT
THIS CAME OUT IN DECEMBER 2011, A
SAMSUNG ENGINEERED ALL THE HARDWARE ON THIS PHONE, EVERY
10
BIT OF IT, AND IT OFFERS, THIS PHONE OFFERS CONSUMER,
11
SMARTPHONE USERS, MANY THINGS THAT THE IPHONE DOESN'T JUST IN
12
TERMS NOW OF THE HARDWARE.
13
14
15
IT HAS A -- YOU CAN'T SEE IT VERY WELL, BUT IT HAS KIND OF

A CURVED SHAPE TO IT.
IT FITS VERY WELL IN THE HAND.
IT HAS A 4.65 INCH SCREEN, WHICH IS LARGE -- A THIRD
16
LARGER THAN, YOU KNOW, THE SAMSUNG -- THE IPHONE SCREEN WAS AT
17
THE TIME THIS CAME OUT.
18
IPHONE TO THIS DAY.
19
IT'S LARGER THAN ANY SCREEN ON ANY
IT HAS A REALLY, A HIGH DEFINITION, VERY, VERY CLEAR
20
SCREEN, A SUPER AMOLED SCREEN WHICH IS CLEAR.
21
THINGS BETTER IN BRIGHT LIGHT.
YOU CAN SEE
22
IT'S GOT A BATTERY IN IT THAT'S SWAPPABLE.
23
EXTRA BATTERY AND SWAP IT OUT WHENEVER YOU WANT.
24
HAVE TO TAKE YOUR PHONE BACK TO THE STORE TO REPLACE THE
25
BATTERY.
YOU CAN BUY AN

YOU DON'T
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IT HAS SOMETHING CALLED NEAR FIELD COMMUNICATIONS, REALLY
COOL.
TRANSFER FILES, INFORMATION, DATA, PHOTO FILES.
WITH A COMPATIBLE PHONE, YOU CAN CLICK THEM TOGETHER AND
IT USES THE VERY HIGH SPEED FOR 4G LTE NETWORK, WHICH
WASN'T INTRODUCED ON THE IPHONE UNTIL MUCH TIME LATER.
CAME OUT WITH A FASTER NETWORK SPEED.
THE TRUTH OF THE MATTER IS, PEOPLE AT SAMSUNG ARE VERY
PROUD OF THE HARDWARE THAT THEY DEVELOPED.
SMARTPHONES AND HARDWARE IN THE WORLD.
10
11
12
13
14
15
16
THIS
THEY BUILT THE BEST
AND TECHNOLOGY REVIEWERS NOTICED WHAT SAMSUNG HAS ACHIEVED

WITH ITS PHONES.
HERE'S ONE UP HERE FROM "LAPTOP MAGAZINE."
WHAT IT SAYS.
YOU CAN SEE
THE BEST HD SCREEN ON THE MARKET.
"WIRED MAGAZINE," THE BEST ANDROID PHONE TO DATE.
THE
TRUEST REPRESENTATION OF ANDROID.

YOU'RE GOING TO LEARN IN THIS CASE THAT WHAT -- WHY DO
17
PEOPLE BUY PHONES?
THEY WANT YOU TO BELIEVE WHAT THEY ARE
18
TRYING TO SELL YOU IN THIS CASE IS THAT PEOPLE BUY PHONES
19
BECAUSE OF FIVE, YES, SMALL SOFTWARE FEATURES, PARTICULAR WAYS
20
OF ACCOMPLISHING THINGS LIKE SYNCING AND SEARCHING.
21
THAT'S WHAT THEY WANT YOU TO BELIEVE.
22
AND THAT BECAUSE OF THOSE FIVE SOFTWARE FEATURES, PEOPLE
23
BOUGHT A LOT MORE SAMSUNG PHONES, AND INSTEAD, IF SAMSUNG
24
DIDN'T HAVE THEM, PEOPLE WOULD HAVE BOUGHT A LOT MORE IPHONES.
25
BUT YOU'LL LEARN THAT IT IS THESE FEATURES THAT I SHOWED
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YOU ON THIS PHONE, HARDWARE FEATURES, AND OTHERS LIKE IT THAT
CAUSED CONSUMERS TO BUY THIS PRODUCT, THINGS LIKE A HIGH
QUALITY SCREEN, A HIGH QUALITY CAMERA, CONNECTIVITY, BATTERY
LIFE, WEIGHT, SHAPE, THINGS LIKE THAT.
THESE ARE THE REASONS, NOT THESE PARTICULAR VARIANTS IN
BACKGROUND OF SOFTWARE FEATURES THAT YOU CAN'T EVEN SEE, THE
THINGS THAT THEY ARE SUING SAMSUNG OVER.
8
9
NOW, ALL OF THIS HARDWARE IN THE NEXUS WAS CREATED BY

SAMSUNG.
EVERY BIT OF IT.
10
AND THEY'RE SUING OVER THIS.
11
IT DOES NOT ACCUSE -- APPLE DOES NOT ACCUSE ANY OF THAT
12
HARDWARE OF INFRINGING ANY OF ITS RIGHTS, AND MR. MCELHINNY
13
SHOWED YOU A SCREEN OF A NUMBER OF SAMSUNG PRODUCTS.
14
THOSE ARE ACCUSED.
15
THAT YOU SEE THERE.
16
INFRINGING ANY OF THE RIGHTS.
17
NONE OF THAT HARDWARE.
NONE OF
NONE OF THE SHAPES
NONE OF THOSE ARE ACCUSED IN THIS CASE OF
YOU MIGHT BE SURPRISED TO LEARN ONE UNDISPUTED FACT.
NOT
18
A SINGLE SOFTWARE FEATURE IN THIS NEXUS PHONE, WHICH I'M
19
HOLDING IN MY HAND, WAS CONCEIVED BY SAMSUNG, WAS DEVELOPED BY
20
SAMSUNG, OR WAS CODED BY SAMSUNG.
21
FEATURES ON THIS PHONE WHICH BRINGS US ALL HERE TODAY WAS
22
DESIGNED, MUCH LESS COPIED, BY ANYONE AT SAMSUNG.
NOT ONE OF THE ACCUSED
23
THE ACCUSED FEATURES ON THIS PHONE WERE DEVELOPED
24
INDEPENDENTLY BY SOME OF THE MOST SOPHISTICATED AND CREATIVE
25
MINDS IN THE SMARTPHONE INDUSTRY, THE SOFTWARE ENGINEERS AT
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GOOGLE UP THE ROAD IN MOUNTAIN VIEW, WHO CREATED THE ANDROID
OPERATING SYSTEM USED BY ALL SMARTPHONE ENGINEERS, MEMBERS OF
THE JURY, EXCEPT FOR APPLE, USED BY ALL HARDWARE COMPANIES, ALL
HANDSET MANUFACTURERS, EXCEPT FOR APPLE.
P.C. MAKERS USE THE MICROSOFT WINDOWS OPERATING SYSTEM, ALMOST
ALL, EVERYBODY BUT APPLE, IN THE SMARTPHONE INDUSTRY USES
ANDROID SOFTWARE, NOT JUST SAMSUNG.
8
9
IN THE WAY THAT MOST
AND IN THIS TRIAL, YOU WILL HEAR FROM THOSE GOOGLE

ENGINEERS.
AND MR. MCELHINNY SAID WE'RE GOING TO POINT THE
10
FINGER AT GOOGLE.
11
GOOGLE.
12
WILL HEAR FROM IN THIS TRIAL, WILL EXPLAIN TO YOU HOW THEY
13
INDEPENDENTLY DEVELOPED THIS SOFTWARE WITHOUT COPYING.
14
WE'RE NOT GOING TO POINT THE FINGER AT
GOOGLE DIDN'T COPY.
THOSE GOOGLE ENGINEERS, WHO YOU
THIS CASE IS REALLY NOT ABOUT THESE FIVE MINOR SOFTWARE
15
FEATURES AND PATENT CLAIMS THAT APPLE IS ASSERTING.
IT'S NOT
16
ABOUT THEM CAUSING PEOPLE NOT TO BUY IPHONES AND INSTEAD TO BUY
17
SAMSUNG PHONES.
18
IPHONE DOESN'T EVEN USE FOUR OUT OF THESE FIVE FEATURES.
19
SMARTPHONES INVOLVE HUNDREDS OF DIFFERENT FEATURES, SOME
20
21
OF THEM BIG, SOME OF THEM SMALL.

YOUR COMMON SENSE -- AND SEVERAL EXPERTS WHO WILL COME IN
22
AND TESTIFY AND WILL TELL YOU THAT CONSUMERS DON'T CHOOSE ONE
23
PHONE OVER ANOTHER BECAUSE OF THE PARTICULAR WAY WORD
24
CORRECTION SUGGESTIONS ARE PRESENTED ON THE SCREEN, WHICH IS
25
WHAT THEIR PATENT COVERS.
THERE'S A LOT OF DIFFERENT WAYS TO
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2
DO THAT.
THEY DON'T BUY A PHONE BECAUSE OF THE PARTICULAR WAY THAT
THE SOFTWARE SYNCS IN BACKGROUND.
DO THAT.
5
6
7
THERE'S MORE THAN ONE WAY TO
OR THE PARTICULAR DESIGN OF THE UNLOCK SCREEN.
THAT'S NOT
WHY CONSUMERS BUY PRODUCTS.

APPLE'S CLAIMS ARE ALL THAT NARROW.
FOLKS.
RESEARCH THAT THEY DO.
APPLE DOES THIS, TOO,
WE'LL SHOW YOU, WE WILL SHOW YOU APPLE'S REAL WORLD

THEY KNOW WHY PEOPLE BUY PHONES.
10
GO OUT AND THEY DO RESEARCH.
11
REAL WORLD RESEARCH THAT THEY DO FOR BUSINESS EVERY SINGLE, YOU
12
KNOW, EVERY DAY, OR HOWEVER OFTEN THEY DO IT, NOT FOR COURT
13
CASES, NOT FOR HIRED EXPERTS, NOT FOR LAWYERS, BUT WHAT THEY DO
14
IN THEIR BUSINESS SHOWS THAT PEOPLE DON'T BUY -- THEY DON'T
15
EVEN ASK SMARTPHONE PURCHASERS, IPHONE PURCHASERS, DID YOU BUY
16
IT FOR THIS FEATURE OR DID YOU BUY IT FOR THAT FEATURE?
17
KNOW THEY DON'T.
18
SHOW THAT TO YOU FROM APPLE'S OWN SURVEYS.
19
THEY SURVEY THEM.
THEY
AND THEIR OWN
THEY
THEY KNOW THAT'S NOT WHAT MATTERS, AND WE'LL
YET APPLE IS HERE LITERALLY SEEKING BILLIONS OF DOLLARS
20
FOR PARTICULAR SOFTWARE CONFIGURATIONS THAT ARE UNDER THE HOOD
21
IN THE PHONE THAT MOST CONSUMERS ARE NOT EVEN AWARE THAT IT'S
22
THERE, AND THEY WANT TO TAKE THAT BIG NUMBER NOT ONLY TO THE
23
BANK, NOT ONLY TO THE BANK, BUT TO GET AN ORDER SAYING THAT
24
NONE OF THESE PHONES CAN BE SOLD IN THE UNITED STATES ANYMORE.
25
IT'S AN ATTACK ON ANDROID.
IT'S AN ATTACK, IT'S AN ATTACK --
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2
MR. MCELHINNY:
OBJECTION, YOUR HONOR.
ARGUMENT.
THE COURT:
OVERRULED.
MR. QUINN:
IT'S THE TRUTH.
THIS IS
OVERRULED.
IT'S AN ATTACK AN
ANDROID, AND THAT'S WHAT THIS CASE IS.
EVEN THOUGH MOST OF THESE PATENT CLAIMS ARE NOT VALUABLE
ENOUGH FOR APPLE TO USE ITSELF, IT CLAIMS THAT ANDROID USES
THEM AND THAT THIS CAUSES CUSTOMERS TO BUY SAMSUNG PHONES.
IF SAMSUNG DIDN'T HAVE THESE FEATURES, THEY'D SELL MORE APPLE
AND
10
PHONES EVEN THOUGH A CUSTOMER LOOKING FOR FOUR OF FIVE OF THESE
11
FEATURES COULDN'T FIND THEM IN AN APPLE PHONE, THEY DON'T USE
12
THEM.
13
AS TO THREE OF THEM, THAT'S UNDISPUTED.
14
SLIDE TO UNLOCK, WE'LL PROVE THAT TO YOU.
15
THE ONLY WAY THAT APPLE CAN MAKE THIS CLAIM FOR BILLIONS
16
OF DOLLARS IS -- WHICH CONFLICTS WITH ALL THE REAL WORLD
17
EVIDENCE YOU'RE GOING TO SEE -- IS TO COME UP WITH A STUDY
18
WHICH THEY DID SPECIALLY FOR YOU BY THE MAN WHOSE NAME WAS
19
INTRODUCED TO YOU, DR. JOHN HAUSER.
20
SOME TIME TALKING WITH YOU THIS AFTERNOON ABOUT DR. HAUSER AND
21
THE SURVEY, AND I WILL SHOW YOU THAT STUDY.
22
AND I'M GOING TO SPEND
WHAT THIS CASE IS REALLY ABOUT IS APPLE TRYING TO LIMIT
23
CONSUMER CHOICE AND TO GAIN AN UNFAIR ADVANTAGE OVER ITS ONE
24
MAJOR COMPETITOR, GOOGLE'S ANDROID, A COMPETITOR THAT HAS
25
PASSED APPLE IN SOME RESPECTS.
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2
3
4
5
DON'T GET ME WRONG, APPLE IS AN AMAZINGLY INNOVATIVE

COMPANY.
BUT IN SOME RESPECTS YOU'LL SEE GOOGLE'S ANDROID HAS
PASSED APPLE.
AND IN THIS CASE, APPLE HAS SUED -- THIS IS WHAT'S GOING
ON HERE -- THE BIGGEST USER OF GOOGLE'S ANDROID SOFTWARE AND
THE MOST SUCCESSFUL MANUFACTURER OF ANDROID PHONES, SAMSUNG, TO
TRY TO PREVENT IT FROM SELLING PHONES WITH THAT LEADING ANDROID
SOFTWARE AND TO GET THE PROFITS THAT SAMSUNG HAS EARNED SELLING
10
11
12
13
ANDROID PHONES.
IT IS TRYING TO GAIN FROM YOU IN THIS COURTROOM WHAT IT
HAS LOST IN THE MARKETPLACE.
YOUR HONOR, WOULD THIS BE A GOOD PLACE TO BREAK?
14
15
THE COURT:
LUNCH.
IT'S 12:01.
LET'S GO AHEAD AND BREAK FOR
WE'LL SEE EVERYONE BACK AT 1:00 O'CLOCK.
16
17
THANK YOU FOR YOUR PATIENCE AND YOUR SERVICE.
18
(JURY OUT AT 12:02 P.M.)
19
THE COURT:
THE JURORS HAVE LEFT THE COURTROOM.
20
THANK YOU.
21
(THE LUNCH RECESS WAS TAKEN FROM 12:02 P.M. TO 12:59 P.M.)
22
23
24
25
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2
AFTERNOON SESSION
THE COURT:
WELCOME.
TAKE A SEAT, PLEASE.
UNDERSTAND THERE'S A SEALING ISSUE.
AN ISSUE?
MR. MCELHINNY:
THE COURT:
MR. SELWYN:
IS THAT RIGHT?
I
IS THERE
THERE IS, YOUR HONOR.
OH, OKAY.
GOOD AFTERNOON, YOUR HONOR.
WITH THE
FIRST WITNESS THIS AFTERNOON --
10
THE COURT:
11
MR. SELWYN:
YES.
-- MR. SCHILLER, SAMSUNG, WE UNDERSTAND,
12
EXPECTS TO USE CERTAIN CONFIDENTIAL BUSINESS INFORMATION OF
13
APPLE THAT DISCUSSES FUTURE BUSINESS STRATEGY, CAPACITY
14
INFORMATION, FINANCIAL INFORMATION.
15
OUR SUGGESTION TO SAMSUNG WAS THAT WE HANDLE THOSE
16
DOCUMENTS MUCH THE WAY WE'VE HANDLED SOURCE CODE IN THE PAST,
17
WHICH IS SHOW IT TO THE JURY AND COUNSEL, NOT PUT IT UP ON THE
18
SCREEN, AND HAVE COUNSEL REFER TO LINES OF THE DOCUMENT RATHER
19
THAN READING ALOUD THE DOCUMENTS TO THE PUBLIC.
20
21
22
THAT WOULD BE ACCEPTABLE TO APPLE, THAT'S WHAT WE'VE DONE

IN THE PAST, AND THEN APPLE WOULD MOVE TO SEAL THE DOCUMENT.
WE UNDERSTAND THAT THERE ARE PORTIONS OF CERTAIN DOCUMENTS
23
THAT SAMSUNG WOULD LIKE TO READ ALOUD THAT RELATE TO
24
CONFIDENTIAL BUSINESS INFORMATION OF APPLE'S CONCERNING FUTURE
25
STRATEGY.
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IF SAMSUNG INTENDS TO DO THAT, THAT'S AN ISSUE FOR US.
THESE ARE DOCUMENTS THAT SAMSUNG HAS NEVER SEEN BEFORE.
SAMSUNG IS NOT ENTITLED TO SEE, VERY SENSITIVE INFORMATION
ABOUT APPLE'S ROADMAP AND FUTURE PRODUCT STRATEGY.
THE COURT:
ALL RIGHT.
SO YOUR REQUEST IS THAT WE,
WHAT, SEAL THE COURTROOM?
WE'VE USED IN THE PAST AND I DON'T SEE WHY A PARTICULAR PIECE
OF INFORMATION HAS GOT TO BE STATED OUT LOUD.
MOVE ALL THESE PEOPLE OUT TO THE HALLWAY.
10
MR. SELWYN:
I WOULD LIKE TO USE THE PROCEDURE
I DON'T WANT TO
THAT IS OUR STRONG PREFERENCE AS WELL,
11
TO DO IT AS WE'VE DONE IN THE PAST, REFERRING THE WITNESS TO
12
PARTICULAR PORTIONS OF THE DOCUMENT, ASKING THE QUESTIONS ABOUT
13
THOSE PORTIONS, BUT NOT READING IT ALOUD AND NOT PUTTING IT UP
14
ON THE SCREEN.
15
MR. PRICE:
THE REASON, YOUR HONOR, THE REASON THEY
16
WANT TO DO THAT IS SO THAT WE CAN'T DO AN EFFECTIVE
17
CROSS-EXAMINATION.
18
THESE DOCUMENTS DON'T HAVE ANYTHING TO DO --
19
THE COURT:
JUST LET ME SEE THE DOCUMENTS.
20
MR. PRICE:
SURE.
21
THE COURT:
PLEASE.
22
MR. PRICE:
I'LL GIVE YOU AN EXAMPLE.
23
YOU EXHIBIT 411.
24
SHOW ANY OF THE NUMBERS IN THE DOCUMENT.
25
IT'S AN EXAMPLE.
MR. SELWYN:
I'LL SHOW TO
THEY'RE NOT GOING TO SAY OR
YOUR HONOR, 411 IS AN IPHONE REVIEW FROM
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THE SPRING OF LAST YEAR.
'678 AND -9, THERE'S DISCUSSION ABOUT CARRIER SUBSIDIES,
SPECIFIC CARRIER SUBSIDIES.
IF YOU LOOK AT, BEGINNING AT PAGES
WE GET INTO FROM 13, 14, AND THEN MOST OF THE REMAINDER OF
THE DOCUMENT, 21, 22, 18 AND 19, 26 THROUGH 32, 36 THROUGH 39
AS FINANCIAL FORECASTS, DISCUSSIONS ABOUT SELLING --
7
8
9
THE COURT:
OKAY.
I'M SORRY TO INTERRUPT YOU.
HAVE A JURY WAITING.

SO JUST GIVE ME THE PAGE NUMBERS THAT ARE IN DISPUTE, AND
10
I'M GOING TO GIVE YOU A RULING, NOT RIGHT NOW, AND WE'RE GOING
11
TO GO AHEAD WITH THIS OPENING STATEMENT.
12
OKAY.
SO WHAT ARE THE NUMBERS IN DISPUTE?
I'LL TAKE A
13
LOOK, AND I'LL LET YOU KNOW WHAT MY RULING IS BEFORE
14
MR. SCHILLER TESTIFIES.
15
MR. SELWYN:
16
THE COURT:
WHAT ARE THE PAGE NUMBERS THAT ARE IN
MR. PRICE:
I CAN MAKE IT EASIER BY TELLING YOU THE
17
18
19
THANK YOU.
DISPUTE?
PAGES I WOULD USE.
20
THE COURT:
OKAY.
21
MR. PRICE:
IT'S IN A DOCUMENT LIKE THIS, THE VERY
22
23
SAME INFORMATION.
THE COURT:
NO, NO.
I WANT TO SEE THE DOCUMENT YOU
24
WANT TO USE.
I WANT TO SEE THE PAGES THAT ARE IN DISPUTE.
25
DON'T WANT IT'S LIKE THIS KIND OF REPRESENTATION.
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MR. PRICE:
413, 413 THEN, YOUR HONOR.
THE COURT:
413.
MR. PRICE:
YES, YOUR HONOR, DX 413.
THE COURT:
AND ANY PARTICULAR PAGES, OR THE WHOLE
MR. PRICE:
YES.
THE COURT:
OKAY.
MR. PRICE:
PAGE 14.
THE COURT:
ALL RIGHT.
10
YOU MEAN DX 413?
THING.
IN PARTICULAR, YOUR HONOR, PAGE 8.
ALLOW YOU TO DO THIS OPEN.
ALL RIGHT.
WHAT ELSE?
PAGE 8, I'M NOT GOING TO
THESE ARE PROJECTIONS FOR FUTURE.
11
MR. PRICE:
NO.
12
THE COURT:
WHEN IS YOUR FISCAL YEAR?
13
MR. SELWYN:
15
THE COURT:
16
MR. SELWYN:
17
THE COURT:
OCTOBER IS THE END OF THE FISCAL YEAR.

SO IT RUNS FROM NOVEMBER TO OCTOBER?
CORRECT.
SO ARE YOU IN FISCAL YEAR 2014 OR 2013?
OR WHAT'S YOUR CURRENT FISCAL YEAR RIGHT NOW?
19
MR. SELWYN:
20
THE COURT:
OKAY.
21
MR. PRICE:
PAGE 14.
22
THE COURT:
OKAY.
23
MR. PRICE:
AND PAGE 46.
24
THE COURT:
OKAY.
25
WHEN DOES
APPLE'S FISCAL YEAR BEGIN AND END?
14
18
THESE ARE CURRENT, YOUR HONOR.
2014.
SO YOU WANT PAGE 8.
IS THAT IT?
WHAT ELSE?
IS THERE ANY OTHER
DISPUTE?
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MR. PRICE:
MR. SELWYN:
ONE MOMENT, YOUR HONOR.

YOUR HONOR, THE PARTIES JUST -- WE MET
AND CONFERRED FOR A LENGTHY AMOUNT OF TIME ABOUT AN ENTIRELY
DIFFERENT DOCUMENT, WHICH IS THE ONE THAT WE HAD BEEN TOLD THAT
THEY WERE GOING TO USE.
SO THESE THREE PAGES ARE NEW TO US AND HAVEN'T BEEN
DISCUSSED SPECIFICALLY BEFORE.
MR. PRICE:
THEY'RE IN THE OTHER DOCUMENT AS WELL.
THE COURT:
OKAY.
WHAT HAPPENED?
I RULED ON THE
10
OBJECTIONS THAT YOU ALL FILED YESTERDAY DURING LUNCH AND LAST
11
NIGHT.
12
WAITING FOR AN OPENING STATEMENT?
13
SO WHY AM I GETTING HIT WITH THIS WHEN I HAVE A JURY
DID YOU CHANGE YOUR MIND --
14
MR. PRICE:
NO.
15
THE COURT:
-- AS TO WHAT EXHIBIT YOU WANTED TO USE?
16
MR. PRICE:
OH, NO, YOUR HONOR.
17
THESE WERE
DISCUSSED.
18
MR. SELWYN:
YOUR HONOR, WE'VE BEEN DISCUSSING THIS
19
FOR THREE DAYS AND TRYING TO GET SPECIFICITY ABOUT WHAT WILL BE
20
OFFERED.
21
THIS IS THE FIRST TIME WE'VE HEARD ABOUT THESE THREE PAGES
22
IN PARTICULAR, AND WE'VE BEEN ASKING TO UNDERSTAND WHAT PAGES
23
WOULD BE USED.
24
25
WE WERE DISCUSSING BEFORE EXHIBIT 411.

RESOLVE THESE THREE PARTICULAR PAGES.
WE MAY BE ABLE TO
THIS IS THE FIRST TIME
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WE'RE HEARING ABOUT THESE.
THE COURT:
ALL RIGHT.
WITH AN OPENING STATEMENT.
LONGER.
WELL, WE'RE GOING FORWARD
I'M NOT HAVING THIS JURY WAIT ANY
SO WHY DON'T YOU MEET AND CONFER, AND LET ME KNOW IF YOU
STILL HAVE A PROBLEM.
THESE THREE DOCUMENTS.
OTHERWISE I'LL GIVE YOU MY RULING ON

OKAY.
MR. SELWYN:
THE COURT:
BUT I'M GOING TO KEEP THIS BINDER.
10
MR. PRICE:
11
THE COURT:
AND IN THE FUTURE, I WANT YOUR SEALING
12
13
14
THANK YOU.
OBJECTIONS IN THE OBJECTIONS THAT YOU'RE FILING, OKAY?

SO WHEN YOU IDENTIFY AN EXHIBIT THAT YOU INTEND TO USE,
YOU NEED TO IDENTIFY THE PAGE NUMBERS, OKAY?
15
MR. PRICE:
I HEAR YOU, YOUR HONOR.
16
THE COURT:
ALL RIGHT.
17
(JURY IN AT 1:06 P.M.)
18
19
20
THANK YOU.
THE COURT:
ALL RIGHT.
WELCOME BACK.
SEAT.
MR. QUINN, IF YOU WOULD PLEASE CONTINUE.
21
MR. QUINN:
22
THE COURT:
THE TIME IS NOW 1:07.
23
MR. QUINN:
24
25
PLEASE TAKE A
GO AHEAD, PLEASE.
BEFORE LUNCH I SHOWED YOU THIS NEXUS PHONE, WHICH IS ONE

OF THE ACCUSED PHONES HERE.
AS I TOLD YOU, ALL THE HARDWARE IN
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HERE IS MADE BY SAMSUNG.
ANDROID.
NONE OF THE SOFTWARE.
IT'S PURE
THERE ARE SOME PHONES, SOME SAMSUNG PHONES WHERE THE
ANDROID SOFTWARE IS SLIGHTLY MODIFIED BY SAMSUNG WHEN WE GET IT
AND PUT IT IN THE PHONE.
BUT JUST SO YOU KNOW, APPLE'S POSITION IS THAT THOSE
MODIFICATIONS DON'T MAKE ANY DIFFERENCE, THAT THE MONEY IS OWED
ANYWAY.
SO THIS IS REALLY ABOUT APPLE VERSUS GOOGLE'S ANDROID, AND
10
I WANT TO TALK TO YOU A LITTLE BIT ABOUT THAT COMPETITION.
11
I'M GOING TO -- AND WHAT THE EVIDENCE IS GOING TO SHOW ABOUT
12
THAT COMPETITION AND ABOUT WHAT APPLE HAS CALLED IN ITS OWN
13
INTERNAL E-MAILS THE INNOVATOR'S DILEMMA.
14
AND
NOW, THE INNOVATOR'S DILEMMA IS ACTUALLY A PRETTY WELL
15
UNDERSTOOD CONCEPT IN ACADEMIC RESEARCH AND TECHNOLOGY.
16
INNOVATOR'S DILEMMA OCCURS WHEN, AND THESE ARE APPLE'S WORDS,
17
THEY'RE STEVE JOBS' WORDS, WHEN A MARKET LEADER HANGS ON TO AN
18
OLD PARADIGM FOR TOO LONG.
19
MARKET LEADER HANGS ON TO AN OLD PARADIGM FOR TOO LONG, IT
20
BECOMES VULNERABLE TO INNOVATION BY OTHERS.
21
THE
AND WHEN THAT HAPPENS, WHEN A
APPLE WAS AN INNOVATOR, BUT IN 2011, THERE WAS ANOTHER
22
COMPANY THAT GOT INTO THE SMARTPHONE WORLD, WHICH WAS ALSO VERY
23
INNOVATIVE, AND THAT'S GOOGLE.
24
WE ALL KNOW GOOGLE.
25
INTRODUCING GOOGLE TO YOU.
I DON'T NEED TO SPEND MUCH TIME

IT STARTED AS A SEARCH COMPANY
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HERE, TWO GUYS, STANFORD UNIVERSITY, IN A GARAGE.
OF YOU KNOW THE STORY.
I THINK MANY
IT STARTED OUT DOING SEARCH, BUT NOW SO MANY DIFFERENT
APPLICATIONS, HUNDREDS OF PEOPLE USE IT EVERY DAY, MAPS, GPS,
YOUTUBE, GOOGLE DOC, GOOGLE VOICE, GOOGLE NEWS.
DIFFERENT THINGS WHICH PEOPLE FIND VERY, VERY USEFUL IN THEIR
EVERY DAY LIVES.
8
9
10
LOTS OF
THEY HAVE THE FINEST SOFTWARE ENGINEERS IN THE WORLD.

SEEMS ON LINE THEY CAN DO JUST ABOUT ANYTHING.
TO COPY PEOPLE.
IT
THEY DON'T NEED
THEY DON'T NEED TO COPY APPLE.
11
LET ME TELL YOU ABOUT THE ANDROID STORY AND HOW THE
12
DEVELOPMENT OF THE ANDROID OPERATING SYSTEM HAPPENED AT GOOGLE.
13
BACK IN 2005, TWO YEARS BEFORE THE IPHONE CAME OUT, EIGHT
14
PEOPLE WHO HAD EXPERIENCE DEVELOPING SMARTPHONES GOT TOGETHER,
15
THEY JOINED GOOGLE, AND SET OUT TO SOLVE A PROBLEM IN THE PHONE
16
INDUSTRY.
17
THE PROBLEM WAS THAT HISTORICALLY THE PHONE INDUSTRY HAD
18
BEEN VERY CLOSED.
19
MANUFACTURERS WHAT PHONES HAD TO DO, WHAT THEY HAD TO LOOK
20
LIKE.
21
CARRIERS BASICALLY TOLD HANDSET
AND ALL THE DIFFERENT HANDSET MANUFACTURERS, THE PHONE
22
MAKERS WERE MAKING THEIR OWN HARDWARE AND TRYING TO MAKE THEIR
23
OWN SOFTWARE AT THE SAME TIME, AND IT TURNS OUT THAT THE
24
HANDSET MANUFACTURERS WEREN'T THE BEST IN THE WORLD AT MAKING
25
CUTTING EDGE SOFTWARE.
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AND BY THE TIME THEIR SOFTWARE GOT TO MARKET, OFTEN THEY

WERE BEHIND.
SO THESE EIGHT PEOPLE WHO JOINED GOOGLE HAD THE IDEA THAT
WHAT THE INDUSTRY REALLY NEEDED WAS A SHARED, OPEN PLATFORM
THAT EVERYONE COULD USE AND CUSTOMIZE AND USE TO INNOVATE AND
IMPROVE.
AND THEY THOUGHT IT WOULD BE BEST IF THIS SOFTWARE, THIS
PLATFORM, WAS NOT CONTROLLED BY JUST ONE COMPANY.
INSTEAD,
THEY WANTED TO GIVE MANUFACTURERS, PHONE MANUFACTURERS,
10
APPLICATION DEVELOPERS, CARRIERS A PLATFORM WHICH THEY COULD
11
ALL USE, ADJUST, INNOVATE WITH, ADAPT TO THEIR OWN USES, DEEPLY
12
BRAND IT, AND TO GIVE THEM THE FREEDOM TO DO WITH THIS COMMON
13
PLATFORM WHAT THEY WANTED TO DO, OR WHAT THEY COULD DO.
14
15
THE IDEA WAS TO CREATE THIS OPEN SOURCE PLATFORM, ANDROID,

AND GIVE IT AWAY.
16
THEY SPENT THREE YEARS BUILDING IT AT GOOGLE AND GAVE IT
17
AWAY.
ANYBODY CAN DOWNLOAD IT IF YOU GO TO SOURCE.ANDROID.COM,
18
AND PEOPLE IN THE INDUSTRY CAN DOWNLOAD THIS OPEN SOURCE
19
PLATFORM.
20
FROM ABOUT 2005 TO 2008, THIS GROUP WORKED TOGETHER
21
BUILDING ANDROID, WORKING LIKE KIND OF A STARTUP INSIDE A MUCH
22
BIGGER COMPANY.
23
CARRIERS TO SEE IF THEY WOULD BE INTERESTED IN THIS OPEN SOURCE
24
PLATFORM, AND IT TURNED OUT THEY WERE.
25
THEY CONTACTED MANUFACTURERS, THEY CONTACTED
AND SINCE THEN, YOU KNOW, IT CAME TO MARKET.
IT'S BEEN
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EXTREMELY SUCCESSFUL.
IN ADDITION TO BEING ON HUNDREDS OF MILLIONS OF PHONES AND
TABLETS, ANDROID IS NOW IN THE DASHBOARD OF SOME CARS.
YOU KNOW, THE AMAZON KINDLE RUNS ON ANDROID.
DOESN'T KNOW ALL THE DEVICES IN THE WORLD THAT RUN ON ANDROID.
IT'S BEEN A HUGE SUCCESS.
IT'S --
EVEN GOOGLE
AND THAT SUCCESS IS A TESTAMENT TO THE HARD WORK AND THE
INGENUITY OF THE ENGINEERS AT GOOGLE AND THE ANDROID
MANUFACTURERS.
IT IS CLEAR THAT GOOGLE'S VISION WAS RIGHT.
10
INNOVATION HAPPENS WHEN EVERYONE IS ABLE TO CONTRIBUTE THEIR
11
OWN IDEAS.
12
AND GOOGLE IS A HIGHLY INNOVATIVE COMPANY.
THEY'RE
13
PERFECTLY CAPABLE OF DEVELOPING THEIR OWN SEARCH FEATURE ON A
14
PHONE WITHOUT COPYING APPLE.
15
BUT THE END OF 2010, THE TOP OF GOOGLE'S MANAGEMENT,
16
STEVE JOBS HIMSELF, RECOGNIZED THAT APPLE ITSELF FACED THE
17
INNOVATOR'S DILEMMA AND THAT GOOGLE INNOVATION WAS DISRUPTING
18
THE SMARTPHONE INDUSTRY THAT APPLE HAD DOMINATED SINCE 2007.
19
20
21
22
23
24
25
IN RESPONSE TO THIS, STEVE JOBS DECLARED, IN 2011, THAT

APPLE WOULD START A HOLY WAR, A HOLY WAR ON GOOGLE.
APPLE KNEW THAT GOOGLE WAS FURTHER ALONG IN SOME IMPORTANT
TECHNOLOGY SO -MR. MCELHINNY:
TO OBJECT.
EXCUSE ME, YOUR HONOR.
AGAIN, I HAVE
THERE'S MOTIONS IN LIMINE ON THIS.
THE COURT:
THERE WAS A MOTION IN LIMINE THAT THAT
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WOULD NOT BE PERMITTED, SO THAT'S STRICKEN.
MR. QUINN:
THAT WAS --
THE COURT:
GO AHEAD, PLEASE.
MR. QUINN:
THAT'S NOT MY UNDERSTANDING, YOUR HONOR.
THE OBJECTIONS TO THIS WERE OVERRULED.
EXHIBIT, DEFENSE EXHIBIT 489.
THE COURT:
GO AHEAD, PLEASE, WITH THE REST OF YOUR
MR. QUINN:
SO MR. JOBS DRAFTED THIS AGENDA IN
THIS DOCUMENT.
IT'S
OPENING.
9
10
OCTOBER 2010 FOR APPLE'S ANNUAL RETREAT OF THE TOP 100
11
EXECUTIVES AT APPLE WHERE THEY GET TOGETHER AND THEY TALK
12
AMONGST THEMSELVES ABOUT WHAT IS MOST IMPORTANT TO THE COMPANY.
13
WE HAVE STEVE JOBS'S AGENDA.
14
AUTHORITATIVE ABOUT WHAT MATTERS TO APPLE.
15
HERE IS THAT AGENDA.
THERE'S NOTHING MORE
IT'S IN DEFENSE EXHIBIT 489, AND YOU
16
CAN SEE UP AT THE TOP HERE -- I DON'T KNOW IF WE CAN ENLARGE
17
THIS.
18
19
20
STEVE JOBS, OCTOBER 2010, IT'S HIS CUT FOR THE AGENDA.
AND THEN IF WE GO FORWARD, GO DOWN BELOW, WHAT DOES HE

WRITE?
"2011 HOLY WAR WITH GOOGLE."
BELOW THAT.
"APPLE IS IN DANGER OF HANGING ON TO THE OLD
21
PARADIGM TOO LONG (INNOVATOR'S DILEMMA) GOOGLE AND MICROSOFT
22
ARE FURTHER ALONG ON THE TECHNOLOGY.
23
24
25
"TIE ALL OUR PRODUCTS TOGETHER SO WE CAN FURTHER LOCK

CUSTOMERS INTO OUR ECOSYSTEM."
AND THEN IF WE CAN GO FORWARD, COMPARISONS WITH GOOGLE,
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3
4
SAMSUNG.
FORWARD.
CATCH UP TO ANDROID WHERE WE ARE BEHIND,
NOTIFICATIONS, TETHERING, SPEECH.

AND THEN NEXT, "STRATEGY:
CATCH UP TO GOOGLE CLOUD
SERVICES.
WAY AHEAD OF APPLE IN CLOUD SERVICES FOR CONTACTS, CALENDARS,
AND MAIL."
8
9
ANDROID DEEPLY INTEGRATES GOOGLE CLOUD SERVICES.
DON'T HAVE TIME TO GO THROUGH THE COMPLETE DOCUMENT NOW,

BUT THIS WILL COME INTO EVIDENCE.
YOU WILL HAVE THIS DOCUMENT.
10
A HOLY WAR ON ANDROID.
11
FROM APPLE'S POINT OF VIEW, GOOGLE'S ANDROID WAS TOO
12
13
SUCCESSFUL.
THAT WAS APPLE'S STRATEGY.
PEOPLE WERE BUYING TOO MANY ANDROID PHONES.
GOOGLE HAD ALWAYS BEEN A CLOUD COMPANY, AND ITS CLOUD
14
TECHNOLOGY, WHICH AMONG OTHER THINGS, ENABLED PEOPLE TO
15
WIRELESSLY SYNC, SYNC THEIR CALENDARS, CONTACTS, AND MAIL AND
16
SAVE THEIR FILES ON A CLOUD SERVER WAS FAR AHEAD OF APPLE'S AND
17
APPLE'S MISSION FOR 2011 WAS TO CATCH UP AND GET AHEAD OF
18
GOOGLE AND ANDROID, AND THIS LAWSUIT IS PART OF THAT STRATEGY.
19
SAMSUNG -- LET ME TURN NOW TO TALK ABOUT SAMSUNG.
20
SAMSUNG, AS MR. MCELHINNY SAYS, HE'S RIGHT, HE'S BEEN A
21
MOBILE PHONE INDUSTRY LEADER SINCE THE EARLY 1990S, LONG BEFORE
22
APPLE LAUNCHED THE IPHONE JUST SEVEN YEARS AGO.
23
BEEN MANY FIRSTS THAT SAMSUNG HAS CONTRIBUTED TO THE CELL PHONE
24
WORLD.
25
IF WE COULD LOOK AT SLIDE 14.
THERE HAVE
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YOU CAN SEE SOME OF THEM UP THERE.
FIRST 3G PHONES, FIRST
3G WINDOWS SMARTPHONE, FIRST CAMERA PHONE, MORE 4G LTE PRODUCTS
IN THE YEAR BEFORE APPLE DID, RECOGNITION SOFTWARE, HIGH DEF
DISPLAYS.
SAMSUNG HAS CONTINUED THAT INNOVATION TO THIS DAY, OFFERED
LARGER SCREENS, PHONES THAT WORK WITH STYLUSES, AND PHONES THAT
CAN TRANSFER PHOTOS, VIDEOS AND OTHER DOCUMENTS JUST BY
CLICKING THE PHONES TOGETHER.
THE PATENT OFFICE HAS RECOGNIZED SAMSUNG'S HARD WORK, AND
10
I FIND IT VERY IRONIC THAT APPLE'S COUNSEL WOULD SAY THAT
11
SAMSUNG DOESN'T CARE ABOUT PATENTS.
12
LAST YEAR THE UNITED STATES PATENT AND TRADEMARK OFFICE
13
AWARDED SAMSUNG THE SECOND HIGHEST NUMBER OF PATENTS IN THE
14
WORLD OF ANY COMPANY IN THE WORLD.
15
CARES ABOUT PATENTS.
16
SAMSUNG
LET ME SHOW YOU ANOTHER PHONE, ANOTHER EXAMPLE OF ONE OF
17
SAMSUNG'S MOST INNOVATIVE PHONES.
18
APPLE IS SUING OVER HERE.
19
NUMBER 1 WAS IBM.
THIS IS THE GALAXY NOTE II.
IT'S ANOTHER PHONE THAT
THIS PHONE HAS -- IT WAS
20
RELEASED IN OCTOBER 2012.
21
SAYS WE WOULDN'T HAVE SOLD SO MANY OF THEM IF WE DIDN'T HAVE
22
THESE PARTICULAR VERSIONS OF THESE SOFTWARE FEATURES.
23
IT'S ONE OF THE PHONES THAT APPLE
THIS PHONE HAS JUST A TON OF UNIQUE FEATURES.
SOME OF
24
THEM UP ON THE SCREEN THERE, THE MULTI WINDOW BROWSING, THE
25
VERY HIGH SPEED PROCESSOR, TWO GIGABYTES OF MEMORY.
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MANY THINGS ON THIS PHONE THAT YOU CAN'T GET ON THE
IPHONE.
OF SMALL FEATURES THAT APPLE IS SUING OVER THAT CAUSED THESE
PEOPLE TO BUY THE PHONES.
SOME PEOPLE WANT THESE FEATURES.
IT'S NOT THESE KINDS
SAMSUNG AND APPLE'S HARDWARE WENT IN VERY DIFFERENT
DIRECTIONS IN 2013.
PRODUCTS UP THERE ON THE SCREENS, SOME COMPARISONS OF SOME OF
THE MORE RECENT PRODUCTS.
YOU CAN SEE A BIG DIFFERENCE IN THEIR
WE WILL PROVE TO YOU IN THIS CASE THAT IT'S THESE
10
FEATURES, THE KIND OF FEATURES I'M SHOWING YOU ON THE NEXUS, ON
11
THE GALAXY NOTE, THINGS LIKE LARGE SCREENS, REPLACEABLE
12
BATTERIES, VERY HIGH QUALITY CAMERA AND SPEED, USE OF STYLUSES,
13
THEY ARE THE KINDS OF THINGS THAT DISTINGUISH SAMSUNG PRODUCTS
14
AND CAUSE PEOPLE TO BUY THOSE PHONES.
15
THAT'S THE REASON WHY SAMSUNG IS THE LEADING MANUFACTURER
16
OF ANDROID POWERED PHONES.
17
ALL THE OTHER PHONES THAT USE THIS SAME OPEN SOURCE ANDROID
18
PLATFORM.
19
IT'S WHAT SETS SAMSUNG APART FROM
ANOTHER IMPORTANT REASON THAT SAMSUNG SELLS PHONES IS IT'S
20
BEEN ABLE TO DO SOME VERY SUCCESSFUL ADVERTISING AND
21
DEVELOPMENT OF ITS BRAND.
22
IN 2011 SAMSUNG HIRED A NEW U.S. MARKETING CHIEF, A MAN BY
23
THE NAME OF TODD PENDLETON.
AND THEY HIRED HIM FROM NIKE.
24
HE APPROACHED ADVERTISING FOR SAMSUNG IN KIND OF A VERY
25
DIFFERENT WAY.
AND
HE STARTED LOOKING AT SOCIAL MEDIA, TWITTER,
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FACEBOOK, WEBSITES, AND TRACKING WHAT PEOPLE WERE SAYING ABOUT
SAMSUNG'S PHONES.
AND THEN HE USED WHAT HE LEARNED FROM SOCIAL MEDIA TO
CREATE ADS, AND THEY SOUNDED REAL TO PEOPLE BECAUSE THEY'RE NOT
ADS THAT WERE WRITTEN BY AD EXECUTIVES, BUT ADS, THINGS THAT
PEOPLE WERE, REAL PEOPLE WERE SAYING ABOUT THEMSELVES AND ABOUT
REAL PHONES.
8
9
AND AROUND THE TIME THAT SAMSUNG WAS DOING THAT AND
CHANGING ITS SHIFT AND ITS APPROACH TO ADVERTISING, THERE WAS
10
AN ARTICLE THAT CAME OUT IN THE "WALL STREET JOURNAL,"
11
OCTOBER 5, 2011, ABOUT THE LAUNCH OF THE IPHONE 4S.
12
AND BASICALLY THE GIST OF THE ARTICLE WAS THAT THE IPHONE
13
4S WAS A REALLY GOOD PHONE, BUT IT WAS MORE, AS THE ARTICLE
14
SAID, MORE FIZZLE THAN POP.
15
AND IN THE MIDDLE OF THIS ARTICLE WAS A BOX, AND THE BOX
16
COMPARED THE IPHONE 4S, APPLE'S NEW PHONE, WITH THE SAMSUNG
17
GALAXY S II.
18
THE TWO OF THEM WERE COMPARED FEATURE BY FEATURE.
19
AND IN THIS BOX, IN THE "WALL STREET JOURNAL,"
AND FROM THAT COMPARISON, THE UPSHOT WAS PRETTY CLEAR THAT
20
ALTHOUGH THE IPHONE 4S WAS A VERY FINE PHONE, THE SAMSUNG PHONE
21
WAS ACTUALLY BETTER.
22
AND TODD PENDLETON, THE NEW HEAD OF MARKETING FOR SAMSUNG,
23
SEIZED ON THIS TO START A NEW ADVERTISING CAMPAIGN, THE NEXT
24
BIG THING IS ALREADY HERE.
25
AND THIS ADVERTISING CAMPAIGN USED THE VOICE OF THE
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CONSUMER, PRESENTED IN KIND OF AN AMUSING WAY, AND THIS THEME
OF THE NEXT BIG THING IS ALREADY HERE TO CREATE A DISTINCTIVE
BRAND PERSONALITY FOR SAMSUNG, AND IT CAUGHT ON, AND IT WAS
POWERFUL.
SUCCESSFUL IN SELLING PHONES.
AND THAT'S ANOTHER REASON SAMSUNG HAS BEEN VERY
AND SAMSUNG'S BRAND BECAME AS STRONG AS APPLE'S.
HERE'S
AN INTERNAL DOCUMENT FROM APPLE SHOWING SOME RESEARCH RESULTS.
YOU CAN SEE THIS IS AN APPLE DOCUMENT -- AS MR. MCELHINNY SAID,
WE EXCHANGED DOCUMENTS IN DISCOVERY -- AND THIS IS WHAT
10
APPLE -- IT SAYS "SAMSUNG'S BRAND IMPRESSION IS JUST AS STRONG
11
AS APPLE'S IN THE U.S.," AND HERE YOU SEE APPLE HERE AND
12
SAMSUNG HERE.
13
14
SO THIS NEW, EDGY MARKETING STRATEGY WAS CLEARLY PAYING

OFF AND, FRANKLY, IT DROVE APPLE CRAZY.
15
WE WILL SHOW YOU INTERNAL APPLE DOCUMENTS, DOCUMENTS THAT
16
HAVEN'T BEEN MADE PUBLIC BEFORE, DOCUMENTS THAT YOU WILL BE THE
17
FIRST TO SEE THAT SHOW HOW APPLE WAS REALLY CONCERNED ABOUT THE
18
COMPETITION IT WAS GETTING FROM ANDROID AND IN PARTICULAR FROM
19
SAMSUNG.
20
21
THE "WALL STREET JOURNAL" PUBLISHED AN ARTICLE, THE TITLE

OF WHICH WAS "HAS APPLE LOST ITS COOL TO SAMSUNG?"
22
AND APPLE'S HEAD OF WORLDWIDE MARKETING, PHIL SCHILLER,
23
WHO APPLE SAYS WILL BE THE FIRST WITNESS WHO WILL TESTIFY TO,
24
FORWARDED THIS TO HIS ADVERTISING AGENCY SAYING "WE HAVE A LOT
25
OF WORK TO DO TO TURN THIS AROUND."
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MR. SCHILLER BECAME MAYBE OBSESSED IS THE RIGHT WORD WITH
SAMSUNG'S CAMPAIGN THAT PORTRAYED SAMSUNG AS THE YOUNGER,
HIPPER CHOICE, AND HE WAS FRUSTRATED THAT APPLE SEEMED
UNWILLING TO RESPOND.
APPLE HAS HAD ONE ADVERTISING COMPANY THAT THEY'VE USED
EXCLUSIVELY FOR YEARS.
CLIENT.
MR. SCHILLER WROTE AN E-MAIL TO TIM COOK SAYING I THINK WE'VE
GOT TO START LOOKING FOR ANOTHER ADVERTISING AGENCY.
10
11
IT'S APPLE.
THAT ADVERTISING COMPANY HAS ONLY ONE
THEY MEET EVERY SINGLE WEEK.
THAT
WE'RE
JUST NOT GETTING WHAT WE NEED.

IT BECAME A SUBJECT OF DISCUSSION AT THE BOARD OF DIRECTOR
12
AT APPLE, WHAT ARE YOU GOING TO DO ABOUT THIS BRANDING PROBLEM?
13
SO THEY INTRODUCED THEIR FIRST BRAND CAMPAIGN SINCE 1997,
14
IT WAS A BRAND CAMPAIGN.
15
IN CALIFORNIA.
16
SINCE 1997 WHEN IT WAS ON THE VERGE OF BANKRUPTCY.
17
THE TITLE WAS SOMETHING LIKE DESIGNED
THE FIRST TIME APPLE HAD DONE A BRAND CAMPAIGN
WHY ALL THIS?
WHY WAS -- WHAT WAS THE SOURCE OF APPLE'S
18
CONCERN?
19
MORE -- A YOUNGER, MORE PLAYFUL TAKE ON SMARTPHONES AND
20
CONSUMERS WERE LISTENING.
21
CLEARLY SAMSUNG WAS OFFERING CONSUMERS A CHOICE, A
NOW, I WANT TO TALK TO YOU ABOUT THE INFRINGEMENT AND
22
ISSUES -- INFRINGEMENT ISSUES AND VALIDITY ISSUES RELATED TO
23
EACH OF THE APPLE PATENTS IN THIS CASE.
24
25
BUT BEFORE I DO THAT, I WANT TO DISCUSS THE DAMAGES, WHICH

I'VE TOLD YOU, FRANKLY, ARE ABSURD, MULTI BILLION NUMBER OF
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DAMAGES THAT THEY'RE SEEKING IN THIS CASE.
I WANT TO TALK ABOUT DAMAGES FIRST BECAUSE I THINK WHEN
YOU UNDERSTAND WHAT APPLE IS SEEKING AND HOW THEY WENT ABOUT
IT, IT'LL SHED SOME LIGHT ON THE CREDIBILITY OF APPLE'S WHOLE
CASE.
AS I'VE TOLD YOU, THESE PATENTS ARE VERY NARROW SOFTWARE
PATENTS THAT COVER -- THAT COVER ONE WAY TO HAVE A FEATURE THAT
CAN BE DONE MORE THAN ONE WAY, FEATURES -- THAT IS TO SAY, WHAT
A DEVICE CAN DO, SEARCH, SYNC IN BACKGROUND, THE OTHER THINGS.
10
11
12
13
14
IT'S NOT THE SAME THING AS A PATENTED CLAIM.
A CLAIM MAY
BE ONE WAY TO ACCOMPLISH THAT FEATURE.

AND MANY COMPANIES, SAMSUNG, GOOGLE, OTHER COMPANIES HAVE
DIFFERENT WAYS OF ACCOMPLISHING THE SAME THING.
WE WILL SHOW YOU THAT APPLE HAS TAKEN WHAT REALLY ARE VERY
15
NARROW FEATURES AND OVERSTATED WHAT THEY DO AND WHAT THEY OWN
16
IN THEIR PATENTS TO CLAIM RIDICULOUS DAMAGES NUMBERS.
17
LET ME BEGIN AT THE END.
I'M GOING TO SHOW YOU SOME
18
NUMBERS, AND YOU'LL SEE THE SOLE SUPPORT, THE ONLY WAY THEY
19
COME UP WITH THESE NUMBERS IS FROM A STUDY DONE BY DR. HAUSER.
20
AND I WANT TO TALK TO YOU ABOUT DR. HAUSER'S STUDY AT
21
LENGTH, BUT LET ME BEGIN AT THE END WITH SOME OF HIS
22
CONCLUSIONS.
23
24
25
AND I'VE PUT UP ON THE SCREEN WHAT HE'S CONCLUDED, OR SOME

OF HIS CONCLUSIONS.
AND HE CONCLUDED BASED ON HIS STUDY THAT PEOPLE WHO WOULD
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PURCHASE A $149 PHONE WOULD BE WILLING TO PAY AN ADDITIONAL
10$2 FOR APPLE'S FORM OF WORD SUGGESTION FOR A CORRECTION; THAT
THEY WOULD PAY AN EXTRA $44 FOR AN ABILITY TO SEARCH THE PHONE
AND THE INTERNET AT THE SAME TIME IN THE WAY, PARTICULAR WAY
THAT APPLE DOES.
TO GET JUST THESE FOUR FEATURES HE SAID THAT PEOPLE WOULD
BE WILLING TO PAY ALMOST DOUBLE THE PRICE OF THE PHONE, $271 ON
TOP OF THE $149 PHONE.
9
10
YOU CAN TELL THERE'S SOMETHING, SOMETHING FISHY HERE.

ANOTHER EXAMPLE OF THEIR OVERREACHING, ANOTHER FORM OF
11
DAMAGES THEY SEEK AS WAS MENTIONED IS A ROYALTY ON THESE
12
PATENTS, AND DR. -- APPLE'S OTHER EXPERT, DR. VELLTURO, TOOK
13
DR. HAUSER'S SURVEY RESULTS AND, YOU KNOW, SORT OF SAID, OKAY,
14
LET'S SUPPOSE THERE WAS A HYPOTHETICAL NEGOTIATION BETWEEN
15
APPLE AND SAMSUNG, WHAT WOULD THEY HAVE AGREED TO AS A ROYALTY?
16
17
18
AND HE CONCLUDED THAT SAMSUNG WOULD HAVE AGREED TO PAY

$40.10 FOR THE SMARTPHONE PATENTS IN THIS CASE.
$40.10 JUST FOR THESE FIVE SMART, SMALL SOFTWARE FEATURES.
19
JUST BY WAY OF COMPARISON, A SMARTPHONE COSTS, YOU KNOW, AT THE
20
HIGH END, SAY $199 TO THE CUSTOMER.
21
FROM THE CARRIERS.
22
23
24
25
YOU HAVE THE SUBSIDIES
THE $40 PER PHONE APPLE IS ASKING FOR THESE 5 SMALL

SOFTWARE FEATURES IS 20 PERCENT OF THE PRICE.
NOW, THEIR EXPERT, DR. VELLTURO, ACKNOWLEDGES THAT SAMSUNG
REALLY WOULDN'T AGREE TO DO THIS BECAUSE IT WOULD TAKE UP MOST
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OF THE PROFIT MARGIN ON THE ACCUSED PHONES IN THIS CASE, BUT NO
MATTER.
APPLE ALSO CLAIMS THAT THERE IS, ON SMARTPHONES, THEY
CLAIM TO HAVE 3,500 PATENTS.
WORTH $8 A PHONE, WHICH IS BASICALLY AN AVERAGE OF THE 5, YOU
KNOW, DIVIDED INTO THE 40 THEY'RE SEEKING HERE, THAT MEANS THAT
ONE SMARTPHONE, IF YOU WANTED TO MAKE A PHONE TO COMPETE WITH
APPLE AND USE THEIR PATENTS, IT WOULD COST $28,000.
MORE THAN THE ACTUAL COST OF THE PHONE.
10
11
12
13
14
IF EACH OF THOSE PATENTS WAS
140 TIMES
SO, YOU KNOW, THESE ARE THE KIND OF RESULTS THAT

DR. HAUSER'S STUDY LED TO.
AND LET'S SEE NOW HOW HE GETS TO THESE CRAZY NUMBERS, AND
LET ME TALK ABOUT THAT STUDY.
REMEMBER, DR. HAUSER, THE WAY HE DOES HIS STUDY, HE'S
15
SUPPOSED TO BE DECIDING HOW MUCH PEOPLE CARE ABOUT THESE
16
FEATURES, WOULD THEY CHANGE THEIR PHONE PURCHASE DECISIONS IF
17
THE FEATURES WERE THERE OR IF THEY WEREN'T THERE.
18
THE WHOLE POINT IS TO PROVIDE THE VALUE OF THE PATENT, THE
19
DIFFERENCE BETWEEN WHAT YOU HAVE WITH THE PATENT CLAIM AND WHAT
20
YOU WOULD HAVE WITHOUT THE PATENTED CLAIM.
21
IN OTHER WORDS, IF YOU HAD ANOTHER WAY TO DO IT THAT APPLE
22
DIDN'T OWN, IT'S CALLED A NON-INFRINGING ALTERNATIVE, WHAT'S
23
THE DIFFERENCE BETWEEN THE TWO OF THEM.
24
25
IF YOU HAVE -- IF THERE ISN'T ANOTHER WAY TO DO IT, THEN

THE PATENT MAY BE REALLY, REALLY VALUABLE.
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BUT IF THERE'S ANOTHER WAY TO ACCOMPLISH THE SAME THING,
IT'S VERY SIMILAR AND IT'S PERFECTLY ACCEPTABLE, THE PATENT
REALLY MAY NOT HAVE MUCH VALUE AT ALL.
SO WHAT DR. HAUSER IS TRYING TO DO IS MEASURE WHAT'S THE
VALUE OF WHAT APPLE CLAIMS VERSUS WHAT THE ALTERNATIVE WOULD
BE, WHAT APPLE DOESN'T OWN.
AND, AGAIN, BEFORE I GO INTO THIS, LET ME EMPHASIZE HOW
IMPORTANT DR. HAUSER'S STUDY IS TO APPLE'S CASE.
IT IS THE
ONLY EVIDENCE, THE ONLY EVIDENCE APPLE HAS TO SUPPORT ITS
10
CLAIMS THAT CONSUMERS MAKE SMARTPHONE PURCHASE DECISIONS BASED
11
ON THESE FIVE SMALL FEATURES.
12
HIS CONCLUSION IS, AS I'VE TOLD YOU, IF SAMSUNG DIDN'T
13
HAVE THEM, WE'D SELL A LOT FEWER AND APPLE WOULD SELL AN AWFUL
14
LOT MORE.
15
16
17
IF HE'S WRONG ABOUT THAT, THEN THEY DON'T HAVE ANY

EVIDENCE ON THIS AND THERE AREN'T REALLY ANY DAMAGES.
IF IT IS THE CASE THAT -- IF IT'S TRUE THAT PEOPLE REALLY
18
AREN'T MOTIVATED, THAT'S NOT WHY YOU BUY SAMSUNG PHONES, THEN
19
APPLE DOESN'T HAVE ANY DAMAGES.
20
SO WHAT DID DR. HAUSER DO?
HE FOUND PEOPLE WHO HAD
21
PURCHASED SAMSUNG PHONES BEFORE AND ASKED THEM SOME QUESTIONS.
22
NOW, ONE OF THE THINGS HE DIDN'T ASK THEM IS WHY DID YOU
23
BUY YOUR SAMSUNG PHONE?
24
SOMETHING THAT YOU WOULD ASK.
25
YOU WOULD THINK THAT MIGHT BE
INTERESTINGLY, HE SAID IN HIS REPORT THAT HE DIDN'T ASK OR
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CARE WHETHER THE SAMSUNG CUSTOMERS WERE EVEN AWARE THAT THESE
FIVE FEATURES WERE IN THEIR PHONES.
THAT.
HE WASN'T INTERESTED IN
HE HAS THE SUBJECTS COME IN, AND HE DOESN'T GIVE THEM
PHONES.
MOCK -- THEY LOOK ON THE COMPUTER SCREEN.
PHONES WITH DESCRIPTIONS OF FEATURES AND THEY ARE ASKED TO MAKE
A SERIES OF DECISIONS BASED ON THE DESCRIPTIONS OF THE FEATURES
ABOUT WOULD YOU BUY THIS PHONE OR WOULD YOU BUY THAT PHONE?
10
HE GIVES THEM DESCRIPTIONS.
BASICALLY THEY LOOK AT

THEY SEE IMAGINARY
IN ADDITION TO THE DESCRIPTION OF THE FEATURE, WHICH IS
11
SUPPOSED TO MATCH APPLE'S PATENTED CLAIMS, WHAT IT OWNS, HE
12
ALSO ASKS -- HE TELLS THEM, IF YOU DIDN'T HAVE THAT, YOU WOULD
13
HAVE TO DO THIS.
14
15
16
THIS IS YOUR ALTERNATIVE.
IN OTHER WORDS, HERE'S THE APPLE FEATURE.
IF YOU DIDN'T
HAVE THAT, YOU WOULD HAVE TO DO THIS.

NOW, YOU KNOW, IF THERE'S A BIG DIFFERENCE BETWEEN THE
17
TWO, YOU'RE GOING TO GET A LOT OF PEOPLE SAYING THIS IS REALLY
18
VALUABLE.
19
BUT THE PEOPLE AREN'T GETTING PHONES.
THIS IS ALL JUST
20
TEXT AND THEY GET TO WATCH A VIDEO AND THEN IN THESE
21
DESCRIPTIONS GETTING THEM ACCURATE IS REALLY, REALLY IMPORTANT
22
TO THE INTEGRITY OF THE SURVEY.
23
SO LET'S START WITH THE -- LET'S SEE WHAT HE DID.
LET'S
24
TAKE A LITTLE BIT OF TIME TO WALK THROUGH THIS.
25
START WITH THE WORD CORRECTION OR WORD SUGGESTION PATENT, WHICH
I'M GOING TO
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AS MR. MCELHINNY TOLD YOU IS ONE THAT THE COURT HAS FOUND
INFRINGEMENT ON THIS ONE.
ONE FIRST, IT'LL TAKE ME A LITTLE WHILE TO WALK THROUGH THIS,
BUT I THINK YOU'LL SEE THAT THE DESCRIPTIONS THAT PEOPLE WERE
GIVEN WERE, FRANKLY, DISHONEST.
AND I WANT TO PROVE THAT TO YOU NOW.
SO I THOUGHT I WOULD TALK ABOUT THAT
THAT'S THE PUNCH LINE HERE,
THIS PATENT RELATES TO THE KEY WORD SOFTWARE.
ON ANDROID
PHONES USERS CAN CHOOSE BETWEEN ANY NUMBER OF DIFFERENT
KEYBOARDS.
KEYBOARDS ARE CONTAINED IN THE SOFTWARE FROM
10
DIFFERENT COMPANIES, FROM GOOGLE, FROM SAMSUNG, FROM A COMPANY
11
CALLED NUANCE, WHICH IS ANOTHER COMPANY THAT, YOU KNOW,
12
SUPPLIES THESE KEYBOARDS, AND THEY'RE IN SOME OF THE SAMSUNG
13
PHONES.
14
INTELLECTUAL PROPERTY FROM NUANCE.
15
NUANCE IS A WELL-KNOWN COMPANY.
APPLE ALSO BUYS
THE KEYBOARD SOFTWARE ARE CREATED BY SAMSUNG WHICH IS ON
16
MANY OF ITS PHONES APPLE ADMITS DOES NOT INFRINGE.
17
SWIPE KEYBOARD FROM NUANCE AND THE ANDROID, ONE OF THE ANDROID
18
KEYBOARDS THAT HAVE BEEN FOUND TO INFRINGE.
19
BUT SAMSUNG HAS A KEYBOARD WHICH APPLE ADMITS DOES NOT
20
INFRINGE.
21
AN ALTERNATIVE TO APPLE'S PATENTED CLAIM.
22
APPLE DOESN'T OWN.
23
IT'S THE
SO, IN OTHER WORDS, THAT'S AN ALTERNATIVE.
THAT'S
IT'S SOMETHING THAT
THIS -- APPLE'S CLAIM -- LET ME TAKE A LOOK AT IT.
IT'S
24
THE '172 PATENT.
YOU'LL SEE IT'S A VERY, VERY NARROW CLAIM
25
ABOUT A PARTICULAR WAY OF SUGGESTING WORD CORRECTIONS ON A
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SMARTPHONE.
WORDS."
THE TITLE OF THE PATENT IS NOT "HOW TO SUGGEST
IT'S "HOW SUGGESTED WORDS ARE PROVIDED AS YOU TYPE," JUST
LIKE THE TITLE SAYS.
IT'S A METHOD FOR PROVIDING WORD
RECOMMENDATIONS.
IT'S ABOUT HOW SUGGESTED WORDS ARE PROVIDED AS YOU TYPE.
THAT'S THE APPLE PATENT.
OKAY?
IT'S NOT ABOUT WHAT WORDS TO SUGGEST.
IN JUNE 2011, BEFORE APPLE'S PATENTED CLAIM ISSUED,
SAMSUNG PUT ITS OWN NON-INFRINGING KEYBOARD ON THE SAMSUNG DART
10
PHONE, AND IT'S SINCE BEEN INSTALLED ON MANY SAMSUNG PHONES,
11
SOMETIMES AS THE PRIMARY KEYBOARD, AND SOMETIMES AS AN
12
ALTERNATIVE KEYBOARD WHICH THE USER CAN SELECT.
13
NON-INFRINGING KEYBOARD WAS INCLUDED AS AN OPTION ON FIVE OF
14
THE PHONES THAT APPLE ACCUSES IN THIS CASE.
15
16
17
LET'S TAKE A LOOK AT IT IN SLIDE 63.
IF YOU TYPE ON THIS KEYBOARD, IT AUTOMATICALLY CORRECTS

TYPING ERRORS.
19
THIS TEXT AREA UP HERE AS YOU TYPE.
21
22
THIS IS THE SAMSUNG
DART NON-INFRINGING KEYBOARD.
18
20
THIS
IT ALWAYS SHOWS THE RECOMMENDED CORRECTIONS IN
IF YOU TYPE, IT WILL JUST CORRECT.
IT AUTOMATICALLY
CORRECTS.
IF YOU WANT TO KEEP ONE OF THE SUGGESTED SPELLINGS, THEY
23
APPEAR HERE IN THIS MESSAGE BAR DOWN HERE, YOU HAVE TO ACTUALLY
24
TOUCH ON IT.
25
SO IF YOU, IF YOU -- IF YOU'RE SENDING AN E-MAIL TO A
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MR. MESSAF AND WANT TO KEEP THAT, AND NOT MESSAGE, YOU CAN
TOUCH ON THIS AND YOU'LL GET MESSAF UP ABOVE.
UP HERE, AUTO CORRECTION IS NOT SOMETHING YOU NEED APPLE'S
PATENTED CLAIM FOR.
AND WATCH WHAT HAPPENS WHEN THE WORD MESSAGE IS MISS TYPED.
SO YOU CAN SEE
WATCH, I'M GOING TO SHOW YOU A VIDEO NOW,
IF WE COULD PLAY THAT.
8
9
10
11
MR. QUINN:
EVERY SINGLE LETTER.
IT WAS AUTOMATICALLY CORRECTED AFTER

YOU END UP AUTOMATICALLY WITH THE
CORRECTION UP ABOVE, MESSAGE.

NOW, LET'S COMPARE THAT TO THE INFRINGING SWIPE KEYBOARD.
12
THIS IS SLIDE 65.
13
NON-INFRINGING SAMSUNG DART KEYBOARD, WHICH WE JUST DISCUSSED.
14
15
16
17
18
19
ON THE LEFT-HAND SIDE YOU HAVE THAT
ON THE RIGHT-HAND SIDE YOU HAVE THE NUANCE SWIPE KEYBOARD

WHICH HAS BEEN FOUND TO INFRINGE.
IT PRACTICES APPLE'S PATENT.
YOU CAN SEE THEY BOTH LOOK SIMILAR.
WE'RE NOT TALKING
ABOUT BIG DIFFERENCES.

THEY BOTH HAVE A TEXT AREA THAT YOU CAN SEE ABOVE AND A
SUGGESTIONS AREA, A SUGGESTIONS BAR BELOW.
20
IF WE COULD GO TO SLIDE 67.
21
YOU CAN SEE THEY BOTH HAVE THIS SUGGESTION BAR.
22
AND ON BOTH OF THEM, IT WILL TYPE, YOU KNOW, MESSAF, THE
23
MISSPELLING ON THE LEFT-HAND SIDE, AND THEN THERE WILL BE SOME
24
SUGGESTIONS AND IF YOU WANT TO TAKE ONE OF THOSE SUGGESTIONS,
25
YOU CAN JUST TAP ON IT.
BOTH OF THEM WORK IDENTICALLY, THE
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NON-INFRINGING SAMSUNG DART KEYBOARD AND THE KEYBOARD THAT
PRACTICES -- THAT INFRINGES APPLE'S PATENT.
HERE IS THE INFRINGING SWIPE KEYBOARD, THE ONE THAT WAS ON
THE RIGHT, IN ACTION.
I WANT TO SHOW THAT TO YOU.
THAT AUTOMATICALLY CORRECTS.
ON APPLE'S KEYBOARD.
YOU'RE TYPING, IT'S NOT UNTIL YOU FINISH AND HIT WHAT'S CALLED
A DELIMITER, EITHER A PERIOD OR A COLON OR A SPACE BAR, THAT IT
POPS UP WHAT THE SUGGESTED WORD IS.
BUT THE WAY IT WORKS IS DIFFERENT
INSTEAD OF CONTINUOUSLY CORRECTING AS
YOU WOULDN'T KNOW WHAT'S
10
GOING TO POP UP UNLESS YOU LOOK DOWN.
11
DOWN BLOW IN THAT SPACE BAR.
12
COME UP WITHOUT ACTUALLY LOOKING DOWN.
13
YOU SEE
THE SUGGESTED WORD IS
YOU WON'T KNOW WHAT'S GOING TO
AND SOME PEOPLE MIGHT SAY THAT THAT, YOU KNOW, APPLE, THAT
14
PATENT, THAT WAY THAT MAKES YOU HAVE TO LOOK DOWN TO SEE IF
15
WHAT YOU REALLY INTENDED TO TYPE IS DOWN THERE IS NOT AS GOOD,
16
IT'S INCONVENIENT, YOU HAVE TO LOOK DOWN.
17
THE WAY YOU KNOW THAT APPLE THINKS THAT'S A NUISANCE,
18
BECAUSE IN THE IPHONE, THEY DON'T USE THAT PATENT, NEVER HAVE.
19
HAVE NEVER USED IT.
THE IPHONE DOES IT DIFFERENTLY.
20
LET'S TAKE A LOOK AT SLIDE 72.
21
THE IPHONE, THE WORD SUGGESTION IS FLOATED IN A BOAT UP IN
22
THE TEXT AREA SO THAT YOU KNOW BY LOOKING UP THERE, YOU DON'T
23
HAVE TO LOOK DOWN, YOU KNOW WHAT'S GOING TO HAPPEN IF YOU HIT
24
THE SPACE BAR OR THE DELIMITER.
25
SO WHAT ARE THE DAMAGES THAT APPLE SEEKS FOR USE OF ITS
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OWN PARTICULAR FORM OF WORD CORRECTION, WHICH IT DOESN'T EVEN
USE, AND WHICH SOME PEOPLE MIGHT CONSIDER INFERIOR?
3
4
5
ACCORDING TO DR. HAUSER'S SURVEY, WHAT SHOULD SAMSUNG PAY?

$206.4 MILLION OF THE 2 BILLION-PLUS DOLLARS.
OF THE -- DR. HAUSER'S STUDY SAID, THAT CHART WE LOOKED AT
BEFORE, SUPPOSEDLY HIS CONCLUSION IS PEOPLE WOULD PAY $102 MORE
PER PHONE TO HAVE THIS FEATURE WHERE YOU HAVE TO LOOK DOWN AND
MAKE YOUR CHOICE, WHICH APPLE DOESN'T EVEN USE.
HOW DID HE ARRIVE AT THAT NUMBER?
10
SURVEY WAS SERIOUSLY FLAWED.
11
ABOUT THE DESCRIPTIONS THEY'RE GIVING.
12
PHONES.
13
WELL, DR. HAUSER'S
REMEMBER, I TOLD YOU, IT'S ALL

THEY DON'T GET ANY
THEY'RE JUST GETTING DESCRIPTIONS.
AND LET ME TELL YOU WHAT THEY WERE TOLD ABOUT THESE WORD
14
SUGGESTION FEATURES, AND THIS IS WHAT THEY WERE TOLD ABOUT
15
APPLE'S PATENTED METHOD.
16
THE SURVEY PARTICIPANTS WERE PRESENTED WITH.
17
TOP AUTOMATIC WORD CORRECTION.
18
YOU'LL SEE IT UP HERE.
THIS IS WHAT
IT SAYS AT THE
NOW, YOU KNOW THAT'S NOT THE TITLE OF THEIR PATENT.
19
JUST LOOKED AT THAT.
20
IS "A METHOD, SYSTEM, AND GRAPHICAL USER INTERFACE FOR
21
PROVIDING WORD RECOMMENDATIONS."
22
WE
IF WE GO BACK TO SLIDE 60, THEIR PATENT
BUT PARTICIPANTS AREN'T TOLD THAT WHAT THEY'RE BEING
23
PRESENTED HERE, THE DESCRIPTION IS JUST OF A METHOD.
24
TOLD THAT THE FEATURE IS AUTOMATIC WORD CORRECTION, PERIOD, IN
25
BIG BOLD LETTERS ON A PICTURE, AN ICON UP HERE, TWO PIECES OF
THEY'RE
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2
3
4
5
6
PAPER.
THE ONE IN THE BACK SAYS X, MISTAKE, BEING REPLACED WITH
ANOTHER PIECE OF PAPER, CHECK, CORRECT.
NO METHOD.
ONLY AUTOMATIC WORD CORRECTION.
ONLY WRONG
SPELLING MADE RIGHT.

THAT ICON IS THE SYMBOL FOR THIS PATENT CLAIM IN
DR. HAUSER'S TEST.
THAT ICON TELLS SURVEY PARTICIPANTS THAT
THEIR ONLY CHOICE -- YOU KNOW, THE CHOICE THAT YOU'RE MAKING,
YOU'RE TRYING TO VALUE WHAT THE DIFFERENCE IS BETWEEN SAMSUNG,
10
THE APPLE PATENT AND WHAT WOULD OTHERWISE HAVE TO DO, THEY'RE
11
TOLD THE ONLY CHOICE IS BETWEEN WORD CORRECTION AND NO WORD
12
CORRECTION.
13
NOW, CLEARLY THE DIFFERENCE BETWEEN HAVING AUTOMATIC WORD
14
CORRECTION IS VERY DIFFERENT FROM THE VALUE OF HAVING IT BY ONE
15
METHOD RATHER THAN ANOTHER.
16
HAVE IT OR YOU DON'T OR YOU HAVE IT BY ONE METHOD OR YOU HAVE
17
IT BY ANOTHER, THERE'S A BIG DIFFERENCE.
THE DIFFERENCE BETWEEN YOU EITHER
18
THERE IS NO SUBTLETY IN DR. HAUSER'S DESCRIPTION.
19
OF COURSE APPLE HAS NO RIGHT TO A MONOPOLY UNDER ITS
20
PATENT CLAIM TO AUTOMATIC WORD CORRECTION BECAUSE, AS YOU HAVE
21
SEEN FROM SAMSUNG'S NON-INFRINGING DART KEYBOARD, YOU ALREADY
22
KNOW THERE'S AT LEAST ONE NON-INFRINGING ALTERNATIVE THAT DOES
23
PROVIDE AUTOMATIC WORD CORRECTION, AND SOME WOULD SAY IT'S
24
BETTER.
25
HAPPENS WHILE YOU ARE TYPING IN THE TEXT AREA.
YOU DON'T HAVE TO LOOK DOWN.
THE CORRECTION, IT
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2
3
SAMSUNG HAD THAT ON ITS PHONES BEFORE APPLE'S PATENT

ISSUED.
SAMSUNG DOES NOT -- WELL, APPLE DOES NOT OWN AUTOMATIC
WORD CORRECTION.
BE PAID FOR IT.
6
7
8
9
10
APPLE DOESN'T INVENT IT.
IT HAS NO RIGHT TO
THE ASSERTION THAT APPLE OWNS AUTOMATIC WORD CORRECTION IS

UNTRUE, AND THAT UNTRUTH INFECTED DR. HAUSER'S SURVEY.
AND, AGAIN, THAT SURVEY IS THE ONLY BASIS IN THIS LAWSUIT
THAT'S GOING TO BE PRESENTED TO YOU FOR THOSE VERY, VERY LARGE
NUMBERS.
11
THIS STUDY IS THE ONLY EVIDENCE OF CONSUMERS' PREFERENCES
12
AND FEATURE VALUE IN THIS LAWSUIT FOR CELL PHONES, FOR TABLETS,
13
FOR EVERY SINGLE CLAIM, ALL FIVE OF THEM, IT ALL COMES BACK TO
14
DR. HAUSER.
15
THIS WASN'T JUST AN INSTANCE OF A CAREFULLY -- CARELESSLY
16
CHOSEN ICON.
17
MISLEAD YOU.
18
IT WAS DELIBERATELY AND CAREFULLY DESIGNED TO
HERE'S THE PART OF THE EXPLANATION THAT WAS GIVEN TO TEST
19
SUBJECTS THAT WAS MEANT TO DESCRIBE WHAT THE ALTERNATIVE WOULD
20
BE, IF YOU DON'T USE APPLE'S PATENTED CLAIM, WHAT'S THE
21
ALTERNATIVE?
22
AND WHAT PEOPLE ARE TOLD, YOU CAN SEE IT HERE, "WITHOUT
23
THIS FEATURE, PRESSING SPACE OR A PERIOD WOULD RETAIN YOUR
24
ORIGINAL TEXT," AND WHAT HE'S TOLD THEM HERE IS IF YOU'RE
25
TRYING TO TYPE BIRTHDAY AND INSTEAD YOU TYPE BIRFDAY WITH AN F,
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IT TELLS THEM "WITHOUT THIS FEATURE, PRESSING SPACE OR A PERIOD
WOULD RETAIN YOUR ORIGINAL TEXT, BIRFDAY.
REPLACE YOUR ORIGINAL TEXT, YOU NEED TO SELECT THE SUGGESTED
BIRTHDAY YOURSELF.
YOU WOULD HAVE TO GO DOWN AND SELECT IT."
THAT'S SIMPLY WRONG.
WRONG.
CORRECTS IN THE SCREEN.
8
9
10
IF YOU WANT TO
APPLE MADE THAT UP.
YOU'VE SEEN THE DART KEYBOARD.
YOU KNOW THAT'S
IT AUTOMATICALLY
IT'S -- THAT'S HOW APPLE COMES UP WITH THESE NUMBERS THAT

THIS IS WORTH $206 MILLION.
APPLE MAKES A VERY, VERY SERIOUS DAMAGES CLAIM, BUT THEY
11
DIDN'T GO ABOUT STUDYING DAMAGES IN ALL SERIOUSNESS.
12
DR. HAUSER'S STUDY, YOU WILL SEE, IS COMPLETELY REMOVED FROM
13
REALITY.
14
IN FACT,
LET ME GIVE YOU ANOTHER EXAMPLE OF AN UNTRUTHFUL
15
DESCRIPTION OF ANOTHER ONE OF THESE PATENTED FEATURES THAT THEY
16
GAVE TO SURVEY PARTICIPANTS, WHICH IS THE WHOLE BASIS FOR THEIR
17
CLAIM THAT FOLKS PREFERRED -- YOU KNOW, WOULD BUY FEWER SAMSUNG
18
PHONES AND WOULD BUY MORE APPLE PHONES.
19
AND THIS IS THE BACKGROUND SYNCING CLAIM.
THIS IS THE
20
DESCRIPTION THAT PEOPLE WERE GIVEN.
AND AT THE TOP IT
21
DESCRIBES THE APPLE PATENT, AND THEN IT DESCRIBES WHAT THE
22
ALTERNATIVE, WHERE IF YOU DON'T PRACTICE THE APPLE PATENT, THIS
23
IS WHAT WOULD HAPPEN TO YOU.
24
"WITHOUT THIS FEATURE, YOU WOULD HAVE TO WAIT TO USE THE
25
APP, FOR EXAMPLE, THE CONTACTS APP, WHILE THE DATA FOR THE APP
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IS SYNCHRONIZING WITH A REMOTE COMPUTER, AND THAT WAIT MAY BE
LONG OR SHORT."
SO IN OTHER WORDS, THE SURVEY PARTICIPANTS ARE TOLD, "YOU
EITHER USE APPLE'S PATENT" WHICH, AGAIN, THIS IS ANOTHER ONE,
APPLE DOESN'T USE THIS, IT'S NOT IN ANY IPHONE, NEVER HAS BEEN,
THEY'RE TOLD, "YOU EITHER USE APPLE'S PATENT, OR YOUR PHONE
WILL FREEZE FOR A PERIOD OF TIME, AND THAT MAY BE A LITTLE
PERIOD OF TIME, OR IT MAY BE A LONG PERIOD OF TIME."
AND THAT IS ALSO, FRANKLY, NOT TRUE.
APPLE DID NOT CREATE
10
THE ONLY WAY TO SYNC DATA WITHOUT THE DEVICE FREEZING.
11
ANOTHER EXAMPLE OF APPLE EXAGGERATING THE SCOPE OF ITS PATENTED
12
CLAIMS.
13
THIS IS
THAT SYNCING, THAT ABILITY, HAD BEEN DEVELOPED USING
14
DIFFERENT PROCESSES BY OTHER INVENTORS AT LEAST SEVEN YEARS
15
BEFORE APPLE'S PATENT ISSUED.
16
PROCESSES IN A LITTLE BIT.
17
I'LL SHOW YOU THOSE OTHER
SO WHEN MR. HAUSER ASKED THEM, YOU KNOW, THE PUNCH LINE IS
18
AFTER THEY'RE GIVEN THESE CHOICES, HE ASKED THEM, HOW IMPORTANT
19
IS THAT FEATURE THAT KEEPS YOUR PHONE FROM FREEZING UP?
OF
20
COURSE WHAT DID THEY SAY, THEY SAID THAT WAS IMPORTANT.
THAT
21
WAS BASED ON A MISREPRESENTATION BECAUSE PHONES CAN USE THOSE
22
OTHER PROCESSES THAT APPLE DOESN'T OWN.
23
EVERYTHING WHEN IT COMES TO SYNCING OR WORD CORRECTION OR ANY
24
OF THESE OTHER FEATURES.
25
APPLE DOESN'T OWN
THE DESCRIPTION ON SYNCING IS WRONG IN ANOTHER RESPECT.
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ALL THE PARTIES AGREE THAT APPLE'S PATENT REQUIRES THAT YOU
HAVE THREE SYNCING COMPONENTS IN THE BACKGROUND.
SO -- IN OTHER WORDS, IT'S NOT JUST ABOUT FREEZING AND SYNCING
GENERALLY.
THREE SYNCING COMPONENTS.
THIS PATENT IS A VERY SPECIFIC ONE.
AND IT'S NOT
IT REQUIRES
DR. HAUSER'S DESCRIPTION TO THE SURVEY PARTICIPANTS DIDN'T
MENTION THIS AT ALL, AND, IN FACT, THE ANDROID SOFTWARE PROCESS
SAMSUNG USES AND APPLE ACCUSES HERE CONTAINS ONLY TWO
COMPONENTS THAT ACTUALLY ARE DOING THE SYNCING.
10
WITHOUT A TRUTHFUL DESCRIPTION OF APPLE'S CLAIMS AND WHAT
11
THE ALTERNATIVES WOULD BE, THE SURVEY, DR. HAUSER'S SURVEY IS
12
WORTHLESS.
13
AS I TOLD YOU, CLEARLY THESE DESCRIPTIONS ARE REALLY
14
IMPORTANT SINCE THAT'S WHAT THE SURVEY PARTICIPANTS ARE BASING
15
ALL THEIR JUDGMENTS ON ABOUT THEIR PREFERENCES AND WHAT'S THIS
16
WORTH.
17
SO YOU MIGHT ASK, WHO WROTE THESE DESCRIPTIONS THAT WERE
18
SO IMPORTANT AND CENTRAL TO THIS SURVEY?
19
IT WAS APPLE'S LAWYERS.
IT WASN'T DR. HAUSER.
20
AND GUESS WHAT?
THEY WEREN'T EXACTLY EVEN-HANDED.
21
LET'S LOOK AT WHAT DR. HAUSER SAID IN HIS REPORT.
IN THE
22
FIRST SENTENCE THERE HE ACKNOWLEDGES THAT TO GET RELIABLE
23
RESULTS FROM THE SURVEY, YOU HAVE TO HAVE CLEAR DESCRIPTIONS.
24
25
THEN HE GOES ON TO ADMIT THAT THEY WERE "PROVIDED TO ME BY

COUNSEL."
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AND HE SAID "I HAVE NOT REVIEWED OR INTERPRETED THE PATENT
CLAIMS MYSELF AND DO NOT HAVE A PROFESSIONAL OPINION ON THAT
MATTER."
4
5
6
HE'S WASHING HIS HANDS OF IT.
HE'S NOT TAKING ANY
RESPONSIBILITY FOR THIS.

SO HE GIVES -- WHAT HAPPENS WITH THESE SURVEY RESULTS?
THEY'RE GIVEN TO ANOTHER APPLE EXPERT, DR. VELLTURO, AND LET'S
JUST TALK FOR A MOMENT ABOUT DR. VELLTURO.
YOU KNOW, UNLIKE MANY EXPERTS YOU'RE GOING TO SEE WHO ARE
10
FACULTY MEMBERS AT UNIVERSITIES, DR. VELLTURO IS NOT A MEMBER
11
OF A FACULTY ANYWHERE.
12
HE'S BASICALLY APPLE'S HOUSE PAID EXPERT WITNESS.
13
HE BASICALLY TESTIFIES FOR A LIVING.
HE SAYS HE CANNOT REMEMBER EXACTLY HOW MANY TIMES HE'S
14
BEEN HIRED BY APPLE TO COME INTO COURTROOMS AND TESTIFY AND HE
15
THINKS IT'S MAYBE 10 TO 12 TIMES.
16
BUT HE TOOK DR. HAUSER'S SURVEY RESULTS AND RAN SOME
17
NUMBERS, AND HE SAID THAT SYNCING COMPONENT CLAIM WHERE PEOPLE
18
WERE TOLD YOU EITHER USE THE APPLE, YOU KNOW, PATENT OR, YOU
19
KNOW, YOU'RE GOING TO HAVE TO WAIT AND THE WAIT COULD BE LONG
20
OR SHORT, HE TOOK THE RESULTS OF THE SURVEY AND HE SAID, WELL,
21
THAT SYNCING CLAIM IS WORTH $724.9 MILLION.
22
SO THAT'S WHERE PART OF THAT OVER 2 BILLION THEY'RE
23
SEEKING COMES FROM THAT CLAIM.
AND ALL THE STEPS LEADING TO
24
THAT NUMBER COLLAPSE BECAUSE THEY'RE ALL BASED ON DESCRIPTIONS
25
WHICH ARE COMPLETELY UNFAIR AND INACCURATE.
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WE HAVE -- WE'VE RETAINED AN EXPERT, DR. DAVID REIBSTEIN,
WHO'S A PROFESSOR AT THE WARD SCHOOL OF BUSINESS AT THE
UNIVERSITY OF PENNSYLVANIA.
SURVEY, THEY'RE CALLED CONJOINT SURVEYS, AND HE SAYS IT'S
COMPLETELY INAPPROPRIATE TO USE THIS TYPE OF SURVEY, A CONJOINT
SURVEY, FOR A COMPLEX PRODUCT WHICH HAS LOTS AND LOTS OF
FEATURES, THAT IT'S JUST A -- THEY SHOULDN'T HAVE USED IT IN
THE FIRST PLACE.
HE'S AN EXPERT IN THESE TYPES OF
HE HAD A REAL QUESTION:
DID THE SURVEY PARTICIPANTS
10
ACTUALLY UNDERSTAND WHAT THEY WERE BEING TOLD, UNDERSTAND THESE
11
DESCRIPTIONS?
12
SO HE DID HIS OWN STUDY.
HE RECRUITED SOME OTHER PEOPLE,
13
JUST LIKE DR. HAUSER HAD, WHO HAD SAMSUNG PHONES.
14
THEM THE SAME VIDEOS, WE HAD THEM, SHOWED THEM THE SAME
15
DESCRIPTIONS, AND, YOU KNOW, HAD THEM TAKE THE SAME TEST.
16
17
18
19
20
HE SHOWED
AND AFTERWARDS HE ASKED THEM, DID YOU UNDERSTAND?

UNDERSTAND THE DESCRIPTIONS IN THE VIDEOS?
DID YOU
THEY ALL SAID, YES.
BUT THEN HE INTERVIEWED THEM AND IT TURNED OUT THEY DIDN'T

UNDERSTAND AT ALL.
MANY OF THE PARTICIPANTS THOUGHT THAT WHEN IT DESCRIBED
21
WORD CORRECTION, THEY THOUGHT THAT MEANT THE CHOICE WAS BETWEEN
22
APPLE'S PATENT CLAIM AND HAVING TO GO BACK AND COMPLETELY
23
RETYPE THE MISSPELLING.
24
25
SOME THOUGHT THE CHOICE WAS BETWEEN USING APPLE'S THREE

PATENT SYNC CLAIM AND NOT HAVING ANY SYNCING AT ALL AND HAVING
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2
TO GO TO ANOTHER DEVICE AND RE-ENTER THE INFORMATION.

SO THERE'S A REAL QUESTION.
I THINK IT'LL BE IN YOUR
MINDS WHEN YOU HEAR THE EVIDENCE AS TO WHETHER PEOPLE REALLY
UNDERSTOOD THIS AT ALL.
5
6
I TOLD YOU BEFORE, APPLE ON ITS OWN DOES SURVEYS AS TO WHY

PEOPLE BUY PHONES.
IF WE COULD LOOK AT SLIDE 50.
THIS IS AN INTERNAL APPLE STUDY, AND IF YOU LOOK AT THE
U.S. ON THE LEFT-HAND SIDE, THE WHOLE THEORY OF APPLE'S CASE
10
HERE IS PEOPLE BUY SAMSUNG PHONES BECAUSE OF THESE FIVE
11
FEATURES AND THEY'RE SO IMPORTANT.
12
WHEN IT COMES TO IPHONES, PEOPLE WHO WANT AN IPHONE MODEL
13
OR A SPECIFIC FEATURE, IT'S ONLY 16 PERCENT OF THE PEOPLE WHO
14
BUY PHONES ACCORDING TO APPLE'S OWN DATA.
15
AND THEN IN THEIR DATA, THEIR SURVEY, THEY DRILL DOWN IN
16
THE 16 PERCENT TO SEE WHAT IS THE FEATURE THAT THEY'RE MOST
17
INTERESTED IN.
18
SYNCING, OR WHAT IS IT?
IS IT OUR PHONE WITH WORD CORRECTION?
IS IT
19
IF WE CAN LOOK AT SLIDE 51.
20
THOSE 16 PERCENT, AS I'VE BEEN TELLING YOU, THEY'RE
21
INTERESTED IN THINGS LIKE BIG FEATURES, WHAT'S THE WEIGHT, THE
22
DISPLAY, THE THINLESS, IS THERE LTE, WHAT'S THE BATTERY LIFE?
23
24
25
APPLE KNOWS THESE ARE THE KINDS OF THINGS THAT DRIVE SALES
OF PHONES.
ANOTHER EXAMPLE OF AN IMPORTANT PHONE FEATURE IS THE MAPS
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APPLICATION.
ITS MAPS APPLICATION.
DEVELOPED THEIR OWN MAP, APPLE MAPS FEATURE AND THEY PUT IT IN
THE PHONE AND IT WAS A DISASTER.
CIRCLES TO DEAD ENDS.
APPLE MAPS FEATURE COULD KILL BECAUSE IT WOULD SEND PEOPLE INTO
THE BARREN OUTBACK WHERE THERE WAS NO WATER.
8
9
IN THE FALL OF 2012, APPLE HAD A BIG PROBLEM WITH

THEY USED TO HAVE GOOGLE MAPS AND THEY
I MEAN, IT SENT PEOPLE IN
POLICE IN AUSTRALIA WARNED THAT THE
THE PR FALLOUT FROM THAT WAS SO BAD THAT APPLE HAD TO

APOLOGIZE TO CONSUMERS, AND TIM COOK WROTE A LETTER TO
10
CONSUMERS ASKING FORGIVENESS AND SUGGESTED THAT THEY ALL SOLVE
11
THE PROBLEM BY REINSTALLING GOOGLE MAPS.
12
13
14
BUT YET THAT PHONE THAT HAD THAT APPLE MAPS FEATURE, THE
IPHONE 5, WAS THE HIGHEST SELLING IPHONE EVER.
WHAT DOES THAT SHOW US?
A PHONE WITHOUT A WORKING MAPS
15
APPLICATION CAN SELL.
A PHONE WITHOUT THESE FIVE SMALL
16
FEATURES, THAT WOULD SELL, TOO.
17
DRIVE SALES.
THESE AREN'T THE THINGS THAT
18
I NOW WANT TO TURN TO APPLE'S INFRINGEMENT CLAIMS.
19
WILL SHOW YOU THAT SAMSUNG DID NOT USE OR INFRINGE FOUR OF THE
20
CLAIMS AND THAT, IN FACT, IN ANY EVENT ALL FIVE ARE INVALID.
21
THEY SHOULDN'T HAVE BEEN ISSUED IN THE FIRST PLACE.
22
OTHER PEOPLE WHO THOUGHT OF THE IDEAS.
23
24
25
WE
THERE WERE
LET'S BEGIN WITH THE '414, THE BACKGROUND SYNCING.
WE'VE
SPOKEN ABOUT THIS SOME ALREADY.

AS I SAID, THIS REQUIRES THAT YOU HAVE THREE SEPARATE SYNC
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2
COMPONENTS THAT ARE CONFIGURED TO DO SYNC.

YOU WILL HEAR IN THIS TRIAL FROM DR. CHASE, OUR EXPERT
WITNESS, AND A GOOGLE ENGINEER PAUL WESTBROOK, WHO WAS INVOLVED
IN DEVELOPING THIS, WHO WILL TELL YOU THAT ANDROID DOES THIS
DIFFERENTLY, DOES NOT USE THIS THREE SYNC PROCESS.
DONE BEFORE.
THE NAME OF GARY HALL, WHO YOU WILL HEAR FROM, WHO'S A WINDOWS
DEVELOPER WHO CALLED BACKGROUND SYNCING A DESIGN PILLAR OF
WINDOWS MOBILE.
10
IT WAS DONE AT WINDOWS MOBILE.
IT HAD BEEN
THERE'S A MAN BY
AND YOU WILL SEE THAT HE -- WINDOWS, MICROSOFT HAD THE
11
ABILITY TO SYNC IN BACKGROUND, AND IT WOULDN'T FREEZE UP.
12
THAT WAS ALL BEFORE APPLE'S PATENT.
13
14
15
AND
AND THEY ALSO SYNCED WITH THREE SYNC COMPONENTS IN THE

BACKGROUND, JUST LIKE APPLE CLAIMS TO DO.
YOU KNOW, THE PATENT AND TRADEMARK OFFICE, YES, THEY
16
ISSUED A PATENT ON THIS.
17
WHEN IT WAS ISSUED.
18
WINDOWS MOBILE IN FRONT OF THEM WHEN THEY ISSUED THIS PATENT.
19
BUT THEY DIDN'T HAVE THIS INFORMATION
THEY DIDN'T HAVE THE INFORMATION ABOUT THE
YOU'LL HEAR THAT ANOTHER GREAT COMPANY WHO WAS DEVELOPING
20
BACKGROUND SYNC BEFORE APPLE EVEN FILED FOR ITS PATENT, AND
21
THAT COMPANY WAS USING BACKGROUND SYNC BEFORE APPLE'S PATENT
22
EVEN ISSUED, AND THAT COMPANY IS GOOGLE.
23
DEVELOPING A SYNCING FEATURE BEFORE THE IPHONE EVER HIT THE
24
MARKET.
25
IT JUST STARTED
AS A CLOUD COMPANY, GOOGLE IS WELL AHEAD OF APPLE IN
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WIRELESS SYNCING.
E-MAIL.
REMEMBER, YOU SAW THAT IN THE STEVE JOBS
HE SAID CATCH UP IN SYNCING.
AND, YOU KNOW, GOOGLE HAD THE ABILITY FROM THE BEGINNING,
AS A CLOUD COMPANY, TO SYNC YOUR CONTACTS AND WIRELESS -- YOUR
CONTACTS AND YOUR CALENDAR WIRELESSLY IN THE FIRST ANDROID
PHONE.
THAT'S SOMETHING YOU COULDN'T DO IN THE FIRST IPHONE.
HAD TO PLUG IT INTO A COMPUTER TO SYNC UNTIL IOS 5 IN 2011.
YOU
THE '647 PATENT, THE ANALYZER SERVER PATENT, SOMETIMES
10
CALLED QUICK LINKS OR LINKS TO STRUCTURES, THIS IS THE PATENT
11
THAT, YOU KNOW, YOU CAN -- IT WILL HIGHLIGHT A PHONE NUMBER OR
12
AN E-MAIL ADDRESS AND YOU CAN TAP ON IT AND IT'LL DO -- YOU
13
KNOW, EXECUTE AN ACTION.
14
THIS DOES NOT COVER EVERY WAY OF DOING A CLICKABLE LINK.
15
THE SIMPLE ABILITY TO CLICK ON A PHONE NUMBER AND MAKE A CALL,
16
OR CLICK ON AN E-MAIL ADDRESS AND SEND AN E-MAIL, THAT HAS BEEN
17
AROUND FOR A LONG TIME.
18
SOMETHING THAT APPLE OWNS.
19
APPLE DIDN'T INVENT THIS.
THIS ISN'T
GOOGLE DESIGNED THE ANDROID SOFTWARE THAT RUNS ON THE
20
BACKGROUND -- IN THE BACKGROUND DIFFERENTLY FOR ITS ANALYZER
21
SERVER.
22
PATENT THAT APPLE HAS ON THIS PARTICULAR FEATURE REQUIRES
23
SOMETHING CALLED AN ANALYZER SERVER, AND I WON'T GO INTO THE
24
DETAILS ABOUT WHAT THAT'S ABOUT NOW, BUT IF YOU ONLY REMEMBER
25
ONE THING I SAY ABOUT THIS PATENT, IT'S ANALYZER SERVER.
YOU'LL HEAR THE EVIDENCE THAT GOOGLE -- THAT THE
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AND THE APPLE PATENT REQUIRES THAT THERE BE AN ANALYZER
SERVER TO ACCOMPLISH THIS IN THE SOFTWARE.
WHAT GOOGLE DOES, WHAT ANDROID DOES, YOU'LL SEE THAT THERE IS
NO ANALYZER SERVER.
AND WHEN YOU SEE
APPLE TRIES TO SAY IT'S SOMETHING ELSE, THEY KNOW THERE
NEEDS TO BE AN ANALYZER SERVER.
SO APPLE TRIES TO SAY IT'S
SOMETHING ELSE.
SAY, WELL, THAT'S REALLY AN ANALYZER SERVER.
TO SEE THAT THAT'S SOMETHING VERY, VERY DIFFERENT.
I THINK THEY CALL IT A SOFTWARE LIBRARY.
THEY
BUT YOU'RE GOING

IN FACT,
10
THEIR OWN INVENTOR WILL TELL YOU THAT SOFTWARE LIBRARIES ARE
11
VERY DIFFERENT THAN AN ANALYZER SERVER.
12
YOU'LL ALSO HEAR IN THIS PATENT THAT THERE WAS PRIOR ART,
13
THAT IT HAD BEEN DONE BEFORE.
14
EMBEDDED BUTTONS THAT HAD BEEN INVENTED AT A VERY FAMOUS
15
INSTITUTION HERE IN PALO ALTO CALLED XEROX PARK, PALO ALTO
16
RESEARCH CENTER IN 1991 WHERE THEY -- THIS SAME TECHNOLOGY
17
EXISTED.
18
HAVE BEEN ISSUED.
19
IT'S NOT NEW.
THERE'S SOMETHING CALLED
IT'S NOT A PATENT THAT EVER SHOULD
THE '721, THE SLIDE TO UNLOCK, YOU KNOW, YOU WILL SEE THAT
20
SAMSUNG, ANDROID HAVE USED LOTS OF DIFFERENT LOCK INTERFACES,
21
VERY DIFFERENT KINDS OF MECHANISMS.
22
ONE IS CALLED THE PUZZLE DESIGN UNLOCK INTERFACE.
23
I MEAN, THE WAY IT WORKS, THE PIECES START UP IN THE
24
CORNER AND YOU CAN MOVE THIS PIECE, THIS PIECE HERE, YOU CAN
25
MOVE IT ALL AROUND.
IT'S NOT LIKE THE SLIDE TO UNLOCK WHERE
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THERE'S A TRACK AND YOU GO FROM THIS POINT TO THIS POINT ALONG
THE TRACK.
THIS PUZZLE PIECE, YOU CAN MOVE IT WITH YOUR FINGER ALL
AROUND.
VERY DIFFERENT.
IT'S AN EFFORT TO COME UP WITH SOMETHING PLAYFUL, FUN.
FOLKS AT SAMSUNG WERE TRYING TO DISTINGUISH THEMSELVES.
8
9
IT UNLOCKS WHEN YOU GO INTO THE HOLE THERE.
THIS IS
THIS IS NOT AN EFFORT TO COPY THE IPHONE.

THE
ANOTHER UNLOCK SCREEN THAT SAMSUNG USES IS A GALAXY 3

RIPPLE WHICH YOU WILL SEE.
UNFORTUNATELY, YOU CAN'T REALLY --
10
THIS DOESN'T REPRODUCE IN A PHOTOGRAPH, BUT IT'S A REALLY COOL
11
DESIGN WHERE IF YOU PUT YOUR FINGER ON THE SCREEN AND MOVE IT,
12
IT'S LIKE WATER RIPPLES ACROSS THE FACE OF THE SCREEN AND YOU
13
CAN MOVE UP, DOWN, ONE WAY OR ANOTHER, AND IT'S LIKE A LITTLE
14
WAVE OF WATER GOING ACROSS THE STREET.
15
NO SLIDE TO UNLOCK, YOU KNOW, APPLE'S SLIDE TO UNLOCK.
16
THEY DON'T ACCUSE THAT.
17
GS III, GALAXY 3, BEST SELLING PHONES.
18
THESE PHONES WITHOUT USING ANY APPLE SLIDE TO UNLOCK FEATURE.
19
THIS IS A BEST SELLING, YOU KNOW, THE

WE'RE SELLING LOTS OF
AND THEN YOU'RE GOING TO SEE THAT APPLE ITSELF HAS MOVED
20
AWAY FROM THAT ORIGINAL SLIDE TO UNLOCK DESIGN IN THE LATEST
21
IOS 7 SOFTWARE, YOU CAN GO FROM ANYWHERE ON THE LEFT-HAND SIDE
22
OF THE SCREEN TO THE RIGHT-HAND SIDE OF THE SCREEN, ANYWHERE AT
23
ANY POINT.
24
HAVE THAT LITTLE CHANNEL DOWN AT THE BOTTOM.
25
THERE'S MUCH MORE FREEDOM OF MOVEMENT.
YOU DON'T
THE WORDS SLIDE TO UNLOCK ARE STILL ON THE PHONE, BUT
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THEY'RE NOT CLAIMING THEY OWN THE WORDS.
THEY'VE GONE IN A DIFFERENT DIRECTION ALTOGETHER.
3
4
5
6
7
8
9
YOU CAN SEE THAT
IS THIS SOMETHING THAT'S REALLY WORTH MILLIONS AND

MILLIONS OF DOLLARS?
IS THIS WHY PEOPLE BUY SMARTPHONES?
THOSE ARE SOME OF THE DECISIONS THAT YOU'RE GOING -- THAT

YOU WILL HAVE TO DECIDE.
WE'LL ALSO SHOW YOU OTHER PRIOR ART.
BEEN SLIDE TO UNLOCK MECHANISMS BEFORE.
YOU KNOW, THERE HAVE
IT'S BEEN DONE BEFORE.
WHAT THEY CALL UNIVERSAL SEARCH, THIS INVOLVES THE -- THE
10
APPLE PATENT ON UNIVERSAL SEARCH INVOLVES A VERY SPECIFIC WAY
11
OF COMBINING LOCAL SEARCH RESULTS THAT ARE ON THE PHONE FROM,
12
LIKE, YOUR CONTACTS OR YOUR CALENDAR AND THINGS LIKE THAT WITH
13
RESULTS THAT COME FROM THE INTERNET.
14
NOW, I THINK IT'S FAIR TO SAY GOOGLE KNOWS SEARCH.
15
THE ENGINEERS AT GOOGLE DON'T NEED TO TURN TO APPLE, YOU KNOW,
16
WHEN THEY'RE BUILDING THEIR ANDROID SOFTWARE TO FIGURE OUT HOW
17
TO DO SEARCH ON A PHONE.
18
SINCE 1997.
19
DOING LOCAL SEARCH ON THE DESKTOP DEVICE CLEAR BACK TO 2004.
20
21
22
AND
THEY'VE BEEN DOING SEARCH AT GOOGLE
THEY'VE BEEN DOING, ON THE DESKTOP, THEY'VE BEEN
THE FUNCTIONS THAT APPLE IS CHALLENGING HERE IN ANDROID ON

PHONES, THEY WERE ADDED TO ANDROID AND SAMSUNG PHONES IN 2009.
BUT, AGAIN, THIS SEARCH CAPABILITY THAT, YOU KNOW, THEY
23
CLAIM TO HAVE A PATENT ON, IT'S NOT SOMETHING THAT THEY HAVE
24
EVER USED.
25
IT'S NEVER BEEN DONE ON THE IPHONE.
WE ASKED THE INVENTOR IN HIS DEPOSITION, AND HE SAYS HE
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2
DOESN'T KNOW ANYONE WHO'S EVER USED THIS.

YOU KNOW, YOU HEARD SOMETHING THAT MR. MCELHINNY SAID THAT
AFTER WE SUED THEM, THEY REMOVED IT.
DO YOU REMEMBER THIS?
AFTER WE SUED THEM, THEY REMOVED IT.
CUSTOMERS COMPLAINED;
THEY PUT IT BACK.
THAT WAS A COMPLETE DISTORTION, FRANKLY.
WHAT HAPPENED IS THEY SUED ON A DIFFERENT SEARCH PATENT.
THEY SUED ON THE '604 PATENT, NOT THIS ONE, AND THEY WENT TO
COURT AND THEY GOT AN INJUNCTION AGAINST OUR DOING THIS TYPE OF
10
SEARCH.
11
COMPLIED.
12
TURNED THAT OFF.
13
WE DIDN'T THINK IT WAS RIGHT.
WE DIDN'T AGREE, BUT WE
AND SO WE -- IT WASN'T HARD TO DO.
I MEAN, WE
WE APPEALED IT, AND THE COURT OF APPEALS REVERSED AND SAID
14
WE WERE RIGHT, APPLE WAS WRONG, WE'RE ENTITLED TO DO IT, AND
15
THEN DROPPED THAT PATENT.
16
17
18
NOW, MR. MCELHINNY LEFT THAT OUT.
HE DIDN'T TELL YOU THAT
PART OF THE STORY.

NOW, WE DID PUT THAT FEATURE BACK IN THE PHONE, BACK IN
19
ANDROID.
20
A WILD, WILDLY POPULAR FEATURE THAT PEOPLE NEED TO SEARCH THE
21
PHONES AND THE INTERNET AT THE SAME TIME.
22
GOOGLE DID THAT.
SAMSUNG DID THAT, NOT BECAUSE IT'S
IT TURNS OUT, YOU KNOW, GOOGLE CAN TRACK THIS.
THE FOLKS
23
AT GOOGLE WILL TELL YOU THAT WHEN YOU GET RESULTS FROM BOTH, ON
24
THE INTERNET AND USING THIS PHONE AND THE FEATURE, IT'S
25
SOMETHING LIKE ONE OUT OF 50 TIMES THAT PEOPLE TAP ON SELECT
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THE PHONE RESULT.
MANY, MANY FEATURES AND WE INCLUDE IT AND WE THINK WE'RE
ENTITLED TO INCLUDE IT.
IT'S JUST NOT THAT BIG A DEAL.
IT'S ONE OF
WE DO IT IN A VERY, VERY DIFFERENT WAY THAN THEIR PATENT
REQUIRES.
THERE'S SOMETHING CALLED A HEURISTIC, WHICH I NEVER
HEARD OF BEFORE I GOT IN THIS CASE, BUT THERE'S A RULE CALLED A
HEURISTIC WHICH MEANS, IT'S AN ENGINEERING OR SOFTWARE TERM
WHICH MEANS BASICALLY A RULE OF THUMB OR SOMETHING THAT'S GOOD
ENOUGH.
IT'LL GIVE YOU AN ANSWER TO THIS, GOOD ENOUGH, KIND OF
10
RULE OF THUMB, AND THEIR PATENT REQUIRES THAT YOU MUST SEARCH
11
IN TWO PLACES AND YOU MUST USE HEURISTICS TO SEARCH IN TWO
12
PLACES, BOTH LOCALLY AND ON THE INTERNET.
13
AND THEY WILL POINT TO A HEURISTIC ON THE LOCAL SEARCH IN
14
ANDROID, BUT THERE ISN'T ONE ON THE INTERNET BECAUSE GOOGLE
15
USERS, NOT SURPRISINGLY, THE RESULTS ARE GOOGLE'S SUGGESTIONS
16
THAT COME TO THE PHONE AND THAT'S NOT A HEURISTIC AT ALL.
17
YOU'LL SEE THERE REALLY ISN'T INFRINGEMENT THERE.
18
SO
THERE IS PRIOR ART, SOMETHING CALLED WAIS, W-A-I-S, WHERE
19
AN M.I.T. PROFESSOR, DR. MARTIN RINARD, WILL TESTIFY ABOUT HOW
20
THIS HAD BEEN DONE BEFORE.
21
22
23
AGAIN, WHEN THIS PATENT ISSUED, THE PATENT OFFICE DID NOT
KNOW ABOUT WAYS.
FINAL CATEGORY OF DAMAGES I HAVEN'T HAD A CHANCE TO
24
MENTION YET -- I'VE MENTIONED AT VARIOUS POINTS THE LOST
25
PROFITS WHERE THEY SAY THEY WOULD HAVE SOLD MORE PHONES, AND WE
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WOULD HAVE SOLD LESS BUT FOR THE USE OF THESE FEATURES.
MENTIONED THE REASONABLE ROYALTY.
I'VE
ANOTHER CATEGORY OF DAMAGES THEY'RE SEEKING IS THEY CALL
BLACKOUT PERIOD OR OFF THE MARKET DAMAGES.
AND BASICALLY THE
THEORY OF THIS IS THEY SAY THEY'RE ENTITLED TO $508 MILLION OF
THE 2 BILLION BECAUSE THEY SAY, WELL, SAMSUNG WOULD HAVE TO
TAKE UP TO FOUR MONTHS TO FIGURE OUT ANY ALTERNATIVE TO THREE
OF THESE PATENTED FEATURES.
WE WOULD HAVE TO TAKE OUR PHONES OFF THE MARKET.
IT WOULD TAKE US FOUR MONTHS, AND

WE COULDN'T
10
BE SELLING THESE PHONES FOR FOUR MONTHS, AND WHILE SAMSUNG IS
11
GONE, APPLE WILL SELL A LOT MORE PHONES.
12
HOW THEY GET THE $508 MILLION.
ALL RIGHT.
SO THAT'S
13
WELL, LET ME TELL YOU SOMETHING.
14
IF WE LOOK AT SLIDE 109.
15
THE IDEA THAT WE NEED FOUR MONTHS TO COME UP WITH SOME
16
ALTERNATIVE IF, IN FACT, WE INFRINGE THESE AND THEY WERE
17
INVALID -- THAT THEY WERE VALID IS JUST NONSENSE.
18
YOU HAVE SEEN THAT WE HAVE A WORD SUGGESTION FEATURE,
19
WHICH THEY ADMIT IS NOT INFRINGING.
20
DART PHONE, WHICH IS AVAILABLE AND COULD BE USED AT ANY TIME.
21
WE DON'T NEED FOUR MONTHS TO PUT THAT IN PHONES.
22
23
24
25
IT'S BEEN ON THE SAMSUNG
WE HAVE OTHER VERSIONS OF LOCK SCREENS, YOU KNOW, THE

RIPPLE.
YOU SAW THAT, THE ONE THAT'S LIKE THE WATER.
IT WOULD TAKE US, THE TESTIMONY WILL BE, AT MOST FOUR DAYS
TO IMPLEMENT AN ALTERNATIVE TO THE ANALYZER SERVER PATENT.
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2
3
SO THERE REALLY IS -- THERE WOULD BE NO BASIS OF ANY AWARD

FOR OFF THE MARKET OR BLACKOUT PERIOD DAMAGES.
YOU'RE GOING TO HEAR, WITH RESPECT TO REASONABLE ROYALTY,
WHICH I TALKED ABOUT A LITTLE BIT EARLIER, REMEMBER THE $40.10
A PHONE THEY'RE ASKING FOR WHICH TRANSLATED, IF YOU COUNT ALL
THE PATENTS, TO SOMETHING LIKE A $24,000 PHONE.
YOU'LL HEAR FROM DR. CHEVALIER, OUR EXPERT, AND SHE DID AN
ANALYSIS ABOUT WHAT IS THE APPROPRIATE METHOD OF FIGURING OUT,
IF ANY ROYALTY, REASONABLE ROYALTY, IF ANY ROYALTY WAS OWING
10
11
HERE, WHAT IT WOULD BE.

AND SHE DID A STUDY.
YOU'LL HEAR FROM HER, AND SHE
12
CONCLUDES THAT FOR ALL FIVE OF THESE, 35 CENTS ALL OF THEM
13
ALTOGETHER.
14
WEBSITES ON AMAZON AND SHE SAYS THERE'S NO MENTION OF THESE
15
FEATURES.
16
ABOUT THEM.
17
SHE LOOKS AT REVIEWS OF SAMSUNG PRODUCTS AND
IT'S NOT LIKE PEOPLE ARE WILDLY POPULAR -- EXCITED
SHE COMPARED THE PROFITABILITY OF THE PRODUCTS WITH THE
18
FEATURES AND WITHOUT THE FEATURES AND CONCLUDED THAT, YOU KNOW,
19
AT LEAST THE WORD SUGGESTION IN SLIDE TO LOCK CLAIMS HAVE NO
20
VALUE AT ALL BECAUSE SAMSUNG'S MOST PROFITABLE PHONES, THE
21
S III AND THE GALAXY NOTE, DON'T -- AREN'T EVEN ACCUSED.
22
SHE LOOKS AT WHAT APPLE TOLD THE GOVERNMENT ITS SOFTWARE
23
WAS WORTH.
24
WAS COMPLETELY INCONSISTENT.
25
AND WHAT DID APPLE TELL THE GOVERNMENT IT TURNS OUT
AM I RUNNING OUT OF TIME?
THANK YOU.
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SO YOU'RE GOING TO HEAR FROM HER THAT WHAT APPLE TELLS THE
GOVERNMENT THE SOFTWARE IS WORTH IS VERY INCONSISTENT.
LOOKS AT APPLE'S OWN PRIOR REPRESENTATIONS TO COURTS ABOUT WHAT
ITS SOFTWARE IS WORTH.
MARKETPLACE, WHAT ARE PEOPLE PREPARED TO PAY FOR APPLICATIONS
ON SMARTPHONES.
7
8
9
SHE
SHE LOOKED AT, YOU KNOW, WHAT'S THE
THE MOST POPULAR ANDROID APPLICATION IS SOMETHING CALLED

SWIFT KEY.
PEOPLE PAY 24 CENTS A UNIT FOR THAT.
SO AFTER CONSIDERING ALL THOSE FACTORS, SHE SAYS 35 CENTS
10
A UNIT, AND IF THERE'S A LUMP SUM ROYALTY PAYMENT, IF ONE WERE
11
OWING -- AGAIN, WE DON'T THINK THERE'S ANY INFRINGEMENT, FOR
12
FOUR OF THE FIVE PATENTS, WE DON'T THINK THEY'RE VALID, BUT IF
13
THERE WERE INFRINGEMENT, IF THEY'RE VALID AND IF A ROYALTY WAS
14
OWING, $39.2 MILLION IS WHAT SHE SAYS IS THE MAXIMUM.
15
SO IN THE BRIEF TIME I'VE GOT LEFT, LET ME TALK A LITTLE
16
BIT ABOUT SAMSUNG'S PATENT CLAIMS AGAINST APPLE.
17
NORMALLY WE AT SAMSUNG DON'T SUE OVER PATENTS LIKE THESE.
18
COUNSEL, I AGREE WITH MR. LEE ON THAT, WE DON'T ORDINARILY SUE
19
ON PATENTS LIKE THESE.
20
AND, FRANKLY,
YOU KNOW, IN THE PRE-HOLY WAR DAYS, WHAT WOULD HAPPEN IN
21
THIS INDUSTRY IS THAT COMPANIES WOULD GET TOGETHER AND ENTER
22
INTO CROSS-LICENSE AGREEMENTS FOR THEIR ENTIRE PORTFOLIOS.
23
THEY WOULD WORK OUT A DEAL AND LEARN TO CO-EXIST.
24
THAT'S WHAT USED TO HAPPEN.
25
BUT WE DID GET SUED, AND SO WE THOUGHT IT WAS APPROPRIATE
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TO DEFEND OURSELVES.
BUT WE UNDERSTAND HOW THIS HAPPENS SOMETIMES.
PEOPLE END
UP STEPPING ON EACH OTHER TOES WITH SIMILAR SOLUTIONS TO
PROBLEMS.
I'M SORRY.
I'M LOSING MY VOICE.
YOU HAVE ENGINEERS FOR THOSE SAME SCHOOLS, MAYBE STANFORD,
BERKELEY, THEY STUDY ENGINEERING.
BUSINESS.
THEY FACE THE SAME PROBLEM.
THEY OWN THE SMARTPHONE
THEY GO TO WORK FOR COMPANIES LIKE GOOGLE AND APPLE.

THEY'RE TRYING TO MAKE A PHONE
10
EASY TO USE, TRYING TO MAKE IT EFFECTIVE, FAST, ADDRESSING THE
11
SAME PROBLEMS, AND SOMETIMES THEY MAY END UPCOMING UP WITH
12
SIMILAR SOLUTIONS AND END UP STEPPING ON EACH OTHER TOES.
13
SOMETIMES HAPPENS.
14
15
16
THAT
AND IN THAT SAME WAY, APPLE HAS STEPPED ON SAMSUNG'S TOES

BY USING SAMSUNG'S VIDEO TRANSMISSION AND VIDEO ALBUM PATENTS.
AND WHEN THAT HAPPENS, AND IT DOES HAPPEN, IT'S NOT A HOLY
17
WAR, OR IT SHOULDN'T BE.
18
REMEDY AND IT'S A SIMPLE ECONOMIC TRANSFER, THAT THERE SHOULD
19
BE A PAYMENT FROM THE COMPANY THAT WAS USING THE TECHNOLOGY
20
THAT DIDN'T HAVE A RIGHT TO, TO THE COMPANY THAT OWNED THE
21
TECHNOLOGY AND DID HAVE A RIGHT TO IT.
22
23
IT'S A SIMPLE THAT THE LAW PROVIDES A
IT'S NOT ABOUT PUNISHING.
IT'S NOT ABOUT PUNISHING THE
WRONG DOER.
24
BUT HERE YOU'LL SEE APPLE IS DOING SOMETHING DIFFERENT.
25
IT'S SEEKING MASSIVE DAMAGES ON THE FICTION THAT THEY'VE LOST
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SALES BECAUSE OF VERY SMALL FEATURES THAT YOU WILL LEARN HAVE
NO IMPACT ON SALES AT ALL.
NOW, I'M GOING TO SHOW YOU HOW WE CALCULATE THE ROYALTY
THAT IS OWING FOR THEIR INFRINGEMENT OF OUR TWO PATENTS, AND WE
WILL DO IT REASONABLY.
AND I'LL JUST NOTE, THEY'RE NOT CHALLENGING THE VALIDITY
OF EITHER ONE OF THEIR PATENTS.
DEEMED VALID FOR PURPOSES OF ALL YOUR DECISION MAKING.
BOTH OF THOSE PATENTS ARE
SO FIRST THE FACETIME PATENT FROM THE '239, AND THIS
10
RELATES TO TRANSMITTING COMPRESSED VIDEO FOOTAGE.
11
A PATENT THAT WAS WAY AHEAD OF ITS TIME.
12
AND THIS IS
LONG BEFORE MOST PEOPLE EVEN HAD MOBILE PHONES, THE
13
INVENTORS OF THIS PATENT FIGURED OUT A WAY TO TRANSMIT VIDEO
14
FROM REMOTE LOCATIONS BY COMPRESSING VIDEO IN REAL TIME SO IT
15
COULD TRANSMIT QUICKLY WITHOUT INTERRUPTION.
16
AND YOU WILL HEAR FROM OUR EXPERT, DR. SCHONFELD, DR. DAN
17
SCHONFELD FROM THE UNIVERSITY OF CHICAGO WHO WILL EXPLAIN TO
18
YOU THAT APPLE HAS, IN FACT, INFRINGED THIS PATENT.
19
THERE ARE TWO KEY TERMS IN THIS PATENT.
20
IT -- IT SAYS IT INCLUDES A COMPUTER WITH A VIDEO CAPTURE
21
MODULE TO CAPTURE THE COMPRESSED VIDEO IN REAL TIME.
22
PRODUCTS, AS WELL AS SAMSUNG PRODUCTS, INCLUDE BOTH CAMERAS AND
23
COMPONENTS THAT CAPTURE VIDEO.
24
25
YOU KNOW,
THE FIRST IS THAT
APPLE'S
THE SECOND TERM IS THERE MUST BE A MEANS FOR TRANSMISSION

OF THE VIDEO.
DR. SCHONFELD WILL SHOW YOU THAT THERE WAS A
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MEANS FOR -- THAT BOTH THOSE TERMS ARE SATISFIED.

THE APPLE FUNCTIONALITIES THAT INFRINGE INCLUDE FACETIME,
FACETIME FEATURE INFRINGES VIDEO, THROUGH VIDEO CONFERENCING.
BY THE WAY, A FEATURE THAT APPLE HAS PROMOTED VERY, VERY
HEAVILY, UNLIKE, YOU KNOW, THE FIVE MINOR SOFTWARE FEATURES
THAT THEY'RE SUING SAMSUNG ON.
AND IT ALSO INFRINGES BY THE ABILITY ON APPLE -- THE
FUNCTIONALITY THAT PERMITS YOU TO TAKE VIDEOS AND TRANSMIT THEM
USING E-MAIL AND MESSAGING ON THE IPHONE.
10
NOW, MR. LEE MADE A BIG TO DO ABOUT THE FACT THAT WE
11
BOUGHT THIS PATENT.
12
BOUGHT IT FROM A VERY CREATIVE FAMILY, THE FREEMANS WHO LIVE IN
13
TULSA, OKLAHOMA.
14
IT'S TRUE.
WE DID BUY THIS PATENT.
IT'S KIND OF AN INTERESTING STORY BEHIND IT.
WE
THEY
15
ORIGINALLY INVENTED THIS IN ORDER TO, YOU KNOW -- THEY LIVE IN
16
AN AREA WHERE THERE'S LOTS OF TORNADOS, AND THEY HAD THE
17
ABILITY TO TRANSFER VIDEO OF TORNADOS TO TV STATIONS AND THINGS
18
LIKE THAT.
19
WHAT'S IMPORTANT TO KNOW IS IT'S NOT IMPORTANT.
IT'S NOT
20
A DEFENSE IN A PATENT CASE THAT A PATENT HAS BEEN PURCHASED.
21
APPLE PURCHASES PATENTS, VOICE RECOGNITION SOFTWARE FROM SIRI.
22
I MEAN, THAT'S ABSOLUTELY IRRELEVANT WHETHER OR NOT THE PATENT
23
WAS PURCHASED.
24
25
SAMSUNG CHOSE THIS PATH BECAUSE OF HOW IMPORTANT AND

INNOVATIVE IT WAS.
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THEY ALSO TOLD YOU THAT THE PATENT HAS NOW EXPIRED.
THAT'S TRUE.
FOR THE PERIOD WHEN THE PATENT WAS ACTIVE, WHICH IS PERFECTLY
APPROPRIATE, PERFECTLY RIGHT.
THAT ALSO DOESN'T MATTER.
WE'RE SEEKING DAMAGES
WE'RE ENTITLED TO DO THAT.
THE OTHER PATENT, THE '449, VIDEO ALBUMS PATENT, THIS
RELATES TO AN INVENTION THAT THE COMPANY HITACHI CAME UP WITH
BACK IN 1997 WHERE THEY CAME UP WITH A REVOLUTIONARY DIGITAL
CAMERA THAT WOULD PERMIT YOU TO COMPRESS AND STORE HUNDREDS OF
PHOTOGRAPHS AND VIDEOS.
10
IN EARLIER CAMERAS, YOU COULD ONLY STORE LIKE TEN PICTURES
11
AND YOU COULDN'T STORE ANY VIDEOS AT ALL.
12
USED CUTTING EDGE TECHNOLOGY TO PERMIT YOU TO STORE SO MANY ON
13
THE CAMERA THAT YOU COULDN'T KEEP TRACK OR FIND OUT WHERE THEY
14
WERE.
15
THIS HITACHI CAMERA
SO THIS IS KIND OF A NIFTY, IF YOU WANT, EASY TO USE
16
FEATURE THAT HITACHI INVENTED.
17
BUILDING FOLDERS RIGHT INTO THE CAMERA TO MAKE IT EASIER TO
18
MANAGE AND TO LOCATE THE PHOTOS AND THE VIDEOS.
19
IT SOLVED THE PROBLEM BY
YOU'LL SEE THAT ON THE LEFT-HAND SIDE HERE, YOU'LL SEE ONE
20
OF THOSE FIGURES FROM THE PATENT.
21
ALBUMS HERE.
22
THE PATENT IS THAT YOU ACTUALLY NUMBER, YOU CAN NUMBER THE
23
ACTUAL NUMBER OF PHOTOGRAPHS THAT ARE THERE.
24
25
YOU'LL SEE THERE'S A LIST OF
IT'S KIND OF AN ENGINEER'S DRAWING, AND PART OF
AND THEN ON THE RIGHT-HAND SIDE, YOU'LL SEE THE ALBUMS,

YOU KNOW, SAME FUNCTIONALITY ON THE IPHONE.
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AND DR. KEN PARULSKI, WHO HAS AN ADVANCED DEGREE FROM
M.I.T., WIDELY RECOGNIZED PIONEER IN DIGITAL PHOTOGRAPHY, WILL
COME HERE AND WALK YOU THROUGH THESE CLAIMS AND SHOW YOU HOW
APPLE INFRINGES THIS PATENT.
SO BECAUSE THESE TWO PATENTS ARE INFRINGED, SAMSUNG IS
ENTITLED TO DAMAGES, AND THOSE DAMAGES, AGAIN, TAKE THE FORM OF
A REASONABLE ROYALTY.
UNLIKE THE MINOR SOFTWARE PATENTS APPLE HAS SUED ON, THE
VIDEO PATENT, THE '239 PATENT INCLUDES VERY IMPORTANT FEATURES
10
THAT RELATE TO THE TRANSMISSION OF VIDEO WHICH APPLE HAS VERY
11
HEAVILY PROMOTED, FACETIME OVER CELLULAR.
12
ALSO E-MAIL, TRANSMISSION OVER E-MAIL, THROUGH TEXT.
13
THIS IS SOMETHING THAT'S BEEN VERY -- THAT IS, IN FACT,
14
SOMETHING VERY IMPORTANT.
15
AND YOU LOOK AT THOSE -- I SHOWED YOU THE IPHONE CONSUMER
16
SURVEY, WHAT FEATURES PEOPLE FOCUS ON.
17
IT.
18
RISE TO THE LEVEL OF SOMETHING PEOPLE TAKE NOTE OF.
19
IT'S SOMETHING THAT IS ADVERTISED,
FACETIME WAS ONE OF THEM.
I DON'T KNOW IF YOU SAW
THAT'S ONE THAT ACTUALLY DOES
THE OTHER, THE VIDEO ALBUMS PATENT, IT'S A MORE -- YOU
20
KNOW, IT'S A USEFUL BUT MORE LIMITED FEATURE, BUT IT'S
21
VALUABLE.
22
AND WE HAVE DR. KEARL, JAMES KEARL, WHO'S A TRAINED
23
ECONOMIST AT M.I.T., WHO DETERMINED THAT APPLE WOULD HAVE PAID
24
$6.9 MILLION FOR A LICENSE IN A NEGOTIATION.
25
AND, YOU KNOW, IT'S -- I FOUND MR. LEE'S ARGUMENT
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SURPRISING, THE FACT THAT, YOU KNOW, WE'RE SUING AND ONLY
ASKING FOR $158,000, OR WE'RE ONLY ASKING FOR $6.78 MILLION
SOMEHOW MEANS THAT WE DON'T RESPECT PATENTS OR THAT WE DON'T
CARE ABOUT PATENTS, THAT THE SUGGESTION SEEMED TO BE THAT IF
YOU AREN'T ASKING FOR BILLIONS, YOU'RE NOT TAKING PATENTS
SERIOUSLY.
YOU WILL SEE -- THE EVIDENCE IN THIS CASE WILL SHOW YOU
THAT THEIR BILLION DOLLAR NUMBERS ARE COMPLETELY UNSUPPORTED.
THEY ALL TIE BACK TO THAT UNRELIABLE HAUSER SURVEY, AND THEY'RE
10
PUTTING THOSE NUMBERS OUT THERE JUST TO TRY TO GET THEM IN YOUR
11
HEAD.
12
13
AND WE WILL SHOW YOU HOW PROPERLY TO CALCULATE A ROYALTY

ON THESE, YOU KNOW, ON THESE PATENTS WHICH APPLE HAS INFRINGED.
14
DR. KEARL CALCULATED THESE DAMAGES.
15
125.
16
ACTUAL DATA THAT HE COULD RELY ON.
17
IF WE LOOK AT SLIDE
HE STARTED WITH SOME REAL WORLD DATA, AND HE HAD SOME
THERE WAS A TIME WHEN FACETIME WAS FIRST INTRODUCED WHERE
18
APPLE ACTUALLY SOLD THAT AS AN APP ON THE MAC, AND IT WAS A
19
HUGE SUCCESS .
20
PEOPLE BOUGHT IT.
IT COST 99 CENTS.
SO THERE'S A POINT, YOU KNOW, A REAL WORLD DATA POINT THAT
21
DR. KEARL COULD WORK WITH, WHAT WOULD PEOPLE PAY FOR THIS?
22
WHAT IS IT WORTH?
23
AND YOU'LL SEE, HE WILL EXPLAIN TO YOU HOW HE THEN DID
24
MARKET STUDIES COMPARING THAT TO OTHER FEATURES, OVER TEXTING,
25
OVER E-MAIL IN THE VIDEO ALBUMS PATENT AND CAME UP WITH THE
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NUMBERS WHICH I SHOWED YOU.

NOW, HERE'S THE IRONY:
ALTHOUGH THE 6.78 MILLION THAT
SAMSUNG IS ASKING FOR FOR THESE TWO PATENTS IS A FRACTION OF
WHAT APPLE IS ASKING FOR ON ITS PATENTS, APPLE SAYS THAT 6.78
MILLION IS FAR TOO MUCH.
APPLE IS SAYING THAT.
IT'S TELLING YOU THAT EVEN
ASSUMING, EVEN ASSUMING IT INFRINGES THE '239 PATENT BY USING
FACETIME, A FEATURE THAT APPLE VERY HEAVILY PROMOTED AS A
MARQUEE FEATURE, IT SHOULD PAY LESS THAN 6.78 MILLION.
10
11
12
AT THE SAME TIME, FOR MUCH MORE MINOR FEATURES, THEY'RE

SEEKING BILLIONS.
IT'S THAT SIMPLE.
ONE THING THEY'RE CORRECT ON.
THESE TYPES OF FEATURES
13
AREN'T WORTH HUNDREDS OF MILLIONS OF DOLLARS.
14
A SIGNIFICANT DIFFERENCE IN SALES.
15
VALUE.
16
MILLION.
17
THEY DON'T MAKE
THEY HAVE VERY LIMITED
IN THIS CASE, DR. KEARL DETERMINED THAT THAT WAS $6.78
SO JUST TO WRAP UP, YOU'VE HEARD APPLE'S LAWYERS SAY THAT
18
SAMSUNG IS TAKING SALES AWAY FROM APPLE BECAUSE IT HAS THESE
19
FEATURES THAT CUSTOMERS WANT AND THAT IF SAMSUNG DIDN'T HAVE
20
THESE FEATURES, SAMSUNG WOULD SELL FEWER PHONES AND APPLE WOULD
21
SELL MORE.
22
APPLE ITSELF DOESN'T EVEN USE FOUR OF THE FIVE.
23
AGREE AS TO THREE.
24
SLIDE TO UNLOCK.
25
THEY
WE HAVE TO PROVE TO YOU THE FOURTH, THE
YOU CAN'T GET THOSE FEATURES BY BUYING AN APPLE PRODUCT.
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THEY'RE NOT IN A PRODUCT.
THEY DON'T USE THEM.
APPLE WANTS YOU TO BELIEVE THAT THESE CLAIMS ARE WORTH
OVER $2 BILLION EVEN THOUGH THEY ARE NOT VALUABLE ENOUGH FOR
APPLE TO USE.
A VERY MUCH MORE COMMON SENSE EXPLANATION AS TO WHY A
PATENT CLAIM IS NOT ADVERTISED OR LICENSED OR USED IS NOT
BECAUSE IT'S WORTH VERY MUCH, BUT BECAUSE IT'S WORTH VERY
LITTLE.
THE CLAIMS, THESE APPLE PATENT CLAIMS ARE ORDINARY WAYS TO
10
DO ORDINARY THINGS THAT HAVE BEEN, CAN BE, AND ARE BEING DONE
11
DIFFERENTLY.
12
ANDROID IS IPHONE'S MAIN COMPETITOR, AND GOOGLE IS AN
13
APPLE OBSESSION.
14
ANDROID, AND THAT IS THE PURPOSE OF THIS LAWSUIT.
15
APPLE'S WHOLE FOCUS IS TO BEAT GOOGLE'S
APPLE HERE IS SINGLING OUT, SINGLING OUT, FROM ALL OF THE
16
ANDROID POWERED HANDSET MANUFACTURERS, IT'S SINGLING OUT THE
17
MOST SUCCESSFUL MANUFACTURER'S PRODUCTS THAT RUN ON ANDROID,
18
SAMSUNG, AND TRYING TO CAPTURE THE PROFITS IT MADE FROM SELLING
19
ANDROID CELL PHONES AND TABLETS.
20
HOW DO YOU KNOW THIS IS TRUE, THIS GALAXY NEXUS PHONE
21
WHICH THEY'RE SUING OVER AND THEY ACCUSE?
22
HARDWARE.
23
SOFTWARE IS PURE ANDROID.
24
25
NOTHING IN THE
THEY DON'T ACCUSE ANYTHING IN THE HARDWARE.
THE
APPLE IS TARGETING NEXUS'S PURE SAMSUNGLESS SOFTWARE.

THAT'S WHAT THIS LAWSUIT IS ABOUT.
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JUST HAVING ANDROID DID NOT GUARANTEE SAMSUNG'S SUCCESS.
THERE ARE MANY DIFFERENT MANUFACTURERS THAT MAKE ANDROID
PRODUCTS.
NOT IN THE THINGS THAT WERE THE SAME, BUT THE THINGS THAT WERE
DIFFERENT, LIKE THE INNOVATION, QUALITY, SELECTION, BUSINESS
STRATEGY, OFFERING A LARGE VARIETY OF DIFFERENT PHONES AT MANY
DIFFERENT PRICE POINTS, THE PROMOTION, THE DEVELOPMENT, THE
BRAND, ALL OF THE RESULTS OF THE HARD WORK FROM THE PEOPLE AT
SAMSUNG.
10
11
12
13
SAMSUNG'S UNIQUE SUCCESS IN THE ANDROID WORLD WAS
LOTS OF PEOPLE, LOTS OF COMPANIES USE ANDROID, BUT NONE OF

THEM ARE SELLING NEARLY AS MANY PHONES AS SAMSUNG.
SAMSUNG'S SUCCEEDS WHERE OTHERS HAVEN'T BECAUSE OF
SAMSUNG'S HARDWARE.
14
IT IS THE SAMSUNG DIFFERENCE -- IT'S THE SAMSUNG
15
DIFFERENCE MAKING CONTRIBUTIONS THAT SELL PHONES AND MAKE IT
16
FAR AND AWAY THE MOST SUCCESSFUL ANDROID -- THE MOST SUCCESSFUL
17
MANUFACTURER IN THE ANDROID WORLD.
18
APPLE DOES NOT ACCUSE THOSE DIFFERENT MAKING HARDWARE
19
FEATURES OF INFRINGEMENT.
20
ON THESE PHONES, PHONES WHICH PEOPLE BOUGHT BECAUSE THEY CARE
21
ABOUT BIG SCREENS, STYLUSES, SUPER HD, AMOLED SCREENS, HIGH
22
QUALITY CAMERAS, AND THE OTHER THINGS THAT YOU COULD ONLY GET
23
ON THAT SAMSUNG PHONE.
24
BE LEFT WHERE THEY SPENT IT.
25
APPLE IS NOT ENTITLED TO THE PROFIT
THE MONEY THAT CONSUMERS SPENT SHOULD
THANK YOU VERY MUCH.
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2
3
4
5
6
THE COURT:
LET'S TAKE A 15 MINUTE BREAK AND WHEN WE COME BACK, APPLE

WILL CALL ITS FIRST WITNESS.
ALL RIGHT.
THANK YOU.
PLEASE DON'T RESEARCH OR DISCUSS
THE CASE.
7
8
OKAY.
THE COURT:
OKAY.
THE RECORD SHOULD REFLECT THE
JURORS HAVE LEFT THE COURTROOM.
MR. SELWYN, HAVE YOU HAD A CHANCE TO -- PLEASE TAKE A
10
SEAT -- HAVE YOU HAD A CHANCE TO TAKE A LOOK AT THOSE THREE
11
PAGES?
12
13
MR. SELWYN:
WE HAVE.
WE HAVE NO OBJECTION TO THOSE
THREE PAGES OF EXHIBIT 14 BEING DISPLAYED PUBLICLY.
14
THE COURT:
OKAY.
15
MR. SELWYN:
AND THAT'S DX 413.
DX 413.
WE UNDERSTAND THAT THOSE ARE
16
THE ONLY THREE PAGES FROM THAT DOCUMENT OR LIKE DOCUMENT THAT
17
THEY INTEND TO USE.
18
THE COURT:
OKAY.
SO THERE'S NO OBJECTION ANYMORE.
19
ALL RIGHT.
20
I'M GOING TO RETURN THIS TO YOU.
21
(RECESS FROM 2:22 P.M. UNTIL 2:37 P.M.)
22
23
THANK YOU.
THE COURT:
OKAY.
THANK YOU.
EVERYONE PLEASE TAKE YOUR SEATS.
24
WELCOME BACK.
PLEASE TAKE A SEAT.
25
YOU HAVE JUST RECEIVED A PHOTO OF THE FIRST WITNESS.
YOU
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WILL GET A PHOTO FOR EVERY WITNESS, AND THERE IS A TAB IN YOUR
JURY BINDER THAT SAYS WITNESS PHOTOS.
INCLUDE THEM.
THAT'S WHERE YOU CAN
YOU'RE FREE TO TAKE NOTES.
THIS IS JUST TO HELP YOU REMEMBER DURING YOUR
DELIBERATIONS, WHICH IS BE A NUMBER OF WEEKS FROM NOW, IT JUST
ENABLES YOU TO PUT A NAME WITH A FACE AND PERHAPS YOUR NOTES,
OR AT LEAST YOUR MEMORIES OF WHAT THAT PERSON SAID.
ALL RIGHT.
9
10
PLEASE CALL YOUR FIRST WITNESS.
MR. MCELHINNY:
YOUR HONOR, MR. PHILIP SCHILLER.
11
(PLAINTIFF'S WITNESS, PHILIP WILLIAM SCHILLER, SWORN.)
12
THE WITNESS:
13
THE CLERK:
14
15
APPLE CALLS AS ITS FIRST WITNESS,
I DO.
WOULD YOU HAVE A SEAT, PLEASE.
AND PULL THE MICROPHONE TOWARDS YOU AND STATE YOUR NAME,
PLEASE, AND SPELL IT.
16
THE WITNESS:
17
W-I-L-L-I-A-M, S-C-H-I-L-L-E-R.
18
19
THE COURT:
ALL RIGHT.
P-H-I-L-I-P,
GO
AHEAD, PLEASE.
20
DIRECT EXAMINATION
21
BY MR. MCELHINNY:
22
Q.
23
AWKWARD.
24
25
PHILIP WILLIAM SCHILLER.
MAKE SURE YOU'RE COMFORTABLE.
I DON'T WANT TO HAVE YOU
READY?
A.
YES.
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Q.
LET'S DO IT AGAIN.
PLEASE INTRODUCE YOURSELF TO THE JURY,
MR. SCHILLER.
A.
MY NAME IS PHILIP SCHILLER.
Q.
BY WHOM ARE YOU EMPLOYED, SIR?
A.
APPLE.
Q.
YOU'RE GOING TO HAVE TO GET THAT MICROPHONE UP THERE.
A.
APPLE.
Q.
THERE YOU GO.
POSITION WITH APPLE?
WHAT IS YOUR POSITION, YOUR CURRENT
10
A.
SENIOR VICE-PRESIDENT OF WORLDWIDE MARKETING.
11
Q.
AND JUST AT A HIGH LEVEL, WHAT ARE YOUR RESPONSIBILITIES?
12
A.
I'M RESPONSIBLE FOR ALL THE MARKETING ORGANIZATIONS AT
13
APPLE.
14
Q.
15
TEAM, SIR?
16
A.
YES.
17
Q.
AND ARE YOU A MEMBER OF APPLE'S EXECUTIVE TEAM?
18
A.
I AM.
19
Q.
AND WHAT IS THE EXECUTIVE TEAM AT APPLE?
20
A.
THE EXECUTIVE TEAM IS MADE UP OF NINE OF US THAT RUN --
21
THAT ARE RESPONSIBLE FOR ALL OF THE FUNCTIONS AT APPLE, AND
22
COLLECTIVELY WE MANAGE APPLE.
23
Q.
HOW LONG HAVE YOU PERSONALLY WORKED AT APPLE, SIR?
24
A.
SOMETHING OVER 23 YEARS.
25
Q.
AS OF TODAY TO WHOM DO YOU REPORT AT APPLE?
DOES APPLE HAVE SOMETHING WHICH IT CALLS THE EXECUTIVE
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A.
THE CEO, TIM COOK.
Q.
LET'S GO BACK.
VIEW OF WHAT YOUR JOB RESPONSIBILITIES ARE?
A.
FUNCTIONS.
MARKETING, BUSINESS MARKETING, EDUCATION MARKETING, OR
DEVELOPER PROGRAMS, CUSTOMER RESEARCH, PRODUCT FINANCE.
8
9
YES.
CAN YOU GIVE US A LITTLE BIT MORE DETAILED
I'M RESPONSIBLE, AGAIN, FOR ALL THE MARKETING

SO THAT'S PRODUCT MARKETING, INTERNATIONAL
I THINK THOSE ARE THE MAJORITY OF THE ORGANIZATIONS.

Q.
AND AS PART -- IS MARKETING THE SAME AS OR DIFFERENT THAN
10
PUBLIC RELATIONS?
11
A.
12
THE WORLD THEY CONSIDER IT ONE OF THE MANY PARTS OF MARKETING
13
AT APPLE.
14
OF MARKETING.
15
Q.
16
IS MARKETING THE SAME AS OR DIFFERENT THAN SALES.
17
A.
VERY DIFFERENT FROM SALES.
18
Q.
CAN YOU THEN EXPLAIN THE RELATIONSHIP BETWEEN THOSE THREE
19
FOR US?
20
A.
21
PRESS ON ALL OF THE THINGS THAT THEY HAVE QUESTIONS ABOUT, THE
22
STORIES THEY'RE WRITING, AND HOW INTERFACE, AND HAVE
23
RELATIONSHIPS WITH MEMBERS OF THE PRESS.
24
25
IT'S -- AT APPLE IT'S DIFFERENT.
I THINK IN GENERAL IN
WE SEPARATE THE PUBLIC RELATIONS TEAM FROM THE REST
AND IS MARKET -- THESE ARE THE LESS ONES I HAD TO LEARN.
LET'S SEE.
PUBLIC RELATIONS IS A TEAM THAT WORKS WITH THE
AND MARKETING COVERS, AT APPLE, A HUGE VARIETY OF THESE

MARKETING DISCIPLINES, LIKE WORKING ON A PRODUCT AND ALL OF THE
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FEATURES THAT CUSTOMERS MIGHT WANT, AND WORKING ON THE WEBSITE.
APPLE.COM IS PART OF MY MARKETING COMMUNICATIONS TEAM OR
WORKING TO LAUNCH A PRODUCT AROUND THE WORLD.
THINGS IN THE MARKETING DOMAIN.
THOSE ARE ALL
AND THEN SALES IS RESPONSIBLE FOR THE CHANNELS THAT OUR
PRODUCT IS OFFERED THROUGH AND SALES TO BOTH END USERS, AS WELL
AS ITS OTHER PARTNERS WHO THEN SELL OUR PRODUCT.
8
9
10
PERSONALLY, I LIKE TO THINK OF SALES AS VERY SHORT-TERM

FOCUS, WHAT DO I HAVE TO DO TO GET A PRODUCT FROM HERE TO THERE
AND HELP SOMEBODY BUY IT RIGHT NOW?
11
WHERE MARKETING WE TRY TO HAVE A LONGER HORIZON LINE TO
12
LOOK FURTHER OUT AT WHAT PEOPLE THINK, WHAT TRENDS ARE
13
HAPPENING, WHAT WE MIGHT DO TO IMPROVE OUR PRODUCTS AND SO ON.
14
SO IT'S A LONGER VIEWPOINT.
15
Q.
16
PRODUCTS?
17
A.
YES, WE DO.
18
Q.
AND DO YOU HAVE A FANCY NAME FOR THAT PROCESS?
19
A.
YES.
20
Q.
DOES MARKETING PLAY A ROLE IN THAT PROCESS?
21
A.
WE DO.
22
CROSS-FUNCTIONAL ORGANIZATION MADE UP OF PEOPLE FROM ALL THE
23
TEAMS, MARKETING, HARDWARE ENGINEERS, SOFTWARE ENGINEERS,
24
FINANCE, OPERATIONS, SUPPORT.
25
DOES APPLE HAVE A PROCESS BY WHICH IT DEVELOPS NEW
IT'S CALLED THE APPLE NEW PRODUCT PROCESS.
THE APPLE NEW PRODUCT PROCESS, OR ANPP, IS A
AND COLLECTIVELY THIS CROSS-FUNCTIONAL TEAM WORKS ON
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WHATEVER PRODUCT THEY'RE WORKING ON.
THIS PROCESS.
AND EVERY PRODUCT FOLLOWS
SO THAT'S THE APPLE NEW PRODUCT PROCESS.
Q.
PRODUCT PROCESS AT APPLE?
A.
REPRESENT THE CUSTOMER, THAT WE'RE ON THAT TEAM TO UNDERSTAND
WHAT CUSTOMERS WANT AND NEED AND OFTEN IN WORKING ON THE
PRODUCT YOU'LL HAVE MANY CHOICES TO MAKE BETWEEN DIFFERENT
10
AND WHAT IS THE ROLE OF MARKETING AS SUCH IN THE NEW
I THINK THE SIMPLEST WAY TO LOOK AT OUR ROLE IS TO
TECHNOLOGIES, DIFFERENT THINGS YOU WANT TO DO WITH THE PRODUCT.
11
AND THE MARKETING TEAM CAN ADD A LOT OF INSIGHT AND
12
DIRECTION BASED ON OUR KNOWLEDGE OF WHAT CUSTOMERS, IF THEY
13
WERE SITTING IN THE ROOM, THEY MIGHT WANT US TO CHOOSE FOR
14
THEM.
15
Q.
16
SIR, I'D LIKE TO TALK TO YOU ABOUT THE IPHONE.

HOW DID APPLE COME TO DEVELOP THE IPHONE?
17
A.
18
HAPPENING IN PARALLEL THAT ALL CAME TOGETHER TO MAKE THE IPHONE
19
COME TO BE.
20
WELL, A NUMBER OF YEARS AGO A BUNCH OF THINGS WERE
ONE OF THE THINGS IS WE HAD GREAT SUCCESS WITH THE IPOD.
21
IT WAS REALLY OUR FIRST BIG SUCCESS AFTER OUR COMPUTER, AFTER
22
THE MAC, WE DID IPOD.
23
AND THIS GREAT LITTLE MUSIC PLAYER MEANT A LOT TO US, AND
24
WE WONDERED WHAT COULD COME LATER ON AFTER IPOD?
25
DEVICE MIGHT YOU HAVE THAT COULD HOLD YOUR MUSIC AND YOUR
WHAT OTHER
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PHOTOS AND VIDEOS AND MEDIA TYPES YOU CARE ABOUT THAT YOU CARRY
WITH YOU.
3
4
5
6
7
AND OUR VISION WAS PERHAPS SOME DAY IT WOULD BE THE PHONE,
THAT COULD BECOME A DEVICE.
SO WE WANTED TO TRY TO INVENT THAT FEATURE RATHER THAN LET
IT HAPPEN TO US.
SECONDLY, THERE WAS SOME OTHER TECHNOLOGY AND THINGS WE
WERE WORKING ON, WE WERE ALREADY WORKING ON WHAT WOULD
EVENTUALLY BECOME THE IPAD, AND WE WERE WORKING ON THAT AND WE
10
HAD COME UP WITH TECHNOLOGY FOR MULTITOUCH USER INTERFACES, FOR
11
USING YOUR HANDS ON THE SCREEN TO MANIPULATE OBJECTS.
12
AND WE REALIZED THAT THAT COULD BE A PRETTY BIG
13
BREAKTHROUGH FOR A PHONE, AND WE COULD TAKE THAT TECHNOLOGY AND
14
INSTEAD USE IT FIRST TO MAKE A PHONE.
15
AND I THINK THE THIRD THING THAT WAS HAPPENING AROUND THAT
16
TIME WAS BECAUSE IPOD WAS A SUCCESS, WE WERE ALWAYS WONDERING
17
WHAT ELSE COULD COME DOWN THE ROAD THAT WOULD CHANGE A WHOLE
18
INDUSTRY LIKE THE IPOD DID?
19
WITH THE IPOD, WHAT CHANGED WAS WE MOVED FROM MECHANICAL
20
DEVICES, DVD PLAYERS, CD PLAYERS, INTO DEVICES THAT WERE
21
CONTROLLED BY SOFTWARE.
22
UNDERGO THAT KIND OF TRANSFORMATION WHERE APPLE COULD BE A
23
LEADER AND MAKING THAT HAPPEN?
24
PHONE, SOME DAY A PHONE, LIKE THE IPOD, COULD BE DRIVEN MOSTLY
25
BY SOFTWARE, NOT JUST BY BUTTONS AND SWITCHES, AND THAT WAS OUR
AND WE ALWAYS THOUGHT WHAT ELSE COULD
AND WE REALIZED THAT COULD BE A
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VIEW OF HERE'S OUR OPPORTUNITY TO CHANGE THIS INDUSTRY AND
CHANGE APPLE.
Q.
HOW LONG WAS THE DEVELOPMENT PROCESS FOR THE IPHONE?
A.
WELL, THERE'S NEVER ONE SIMPLE MOMENT IN TIME WHEN IT
STARTS.
TIMES.
A NUMBER OF THINGS ARE ALL BEGINNING AT DIFFERENT
BUT ROUGHLY, YOU KNOW, TWO AND A HALF YEARS OR SO, EARLY
IN 2004 TO 2005 TIMEFRAME PEOPLE WERE BEGINNING TO WORK ON IT.
Q.
AND WHEN WAS THE IPHONE EVENTUALLY ANNOUNCED?
10
A.
IN JANUARY OF 2007.
11
Q.
AND WAS THE DEVELOPMENT CONTINUOUS FROM THE TIME FROM 2004
12
TO 2007?
13
A.
14
MORE AND MORE PEOPLE WERE ADDED TO THE PROJECT OVER TIME.
15
YES.
IT -- IT BEGAN AND AS IT PICKED UP STEAM AND GREW,
BUT IT WAS BEING DEVELOPED THAT ENTIRE TIME.
16
Q.
APPROXIMATELY HOW MANY PEOPLE AT APPLE WERE INVOLVED IN
17
THE IPHONE PROJECT?
18
A.
19
SMALL TEAM THAT GREW QUICKLY TO HUNDREDS OF PEOPLE, AND REALLY
20
IN THE END, IT BECAME THE WHOLE COMPANY.
21
PRODUCT AND INVOLVES PRETTY MUCH EVERY ORGANIZATION AT APPLE.
22
Q.
WAS THIS PROJECT CONFIDENTIAL AT APPLE?
23
A.
VERY MUCH.
24
Q.
AND WHAT WERE SOME OF THE OBJECTIVE EVIDENCE THAT IT WAS
25
CONFIDENTIAL?
WELL, IT CHANGES OVER TIME.
AT THE BEGINNING IT WAS A
IT WAS OUR NUMBER ONE
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A.
WE KNEW THIS WAS SO BIG AND IMPORTANT TO APPLE THAT EXTRA STEPS
WERE TAKEN TO KEEP IT SECRET.
WELL, WE TRY TO KEEP ALL OF OUR PROJECTS CONFIDENTIAL, BUT
NOT ONLY DID WE LIMIT THE NUMBER OF PEOPLE WHO WOULD KNOW
WHAT WAS GOING ON, BUT THOSE PEOPLE NEEDED TO ACTUALLY SIGN A
SPECIAL NONDISCLOSURE AGREEMENT SPECIFICALLY FOR THIS PROJECT
TO SAY THIS IS EXTRA SECRET AND NEEDED, NEEDED THAT
DOCUMENTATION.
AND YOU WEREN'T ALLOWED TO TALK TO OTHER PEOPLE WHO AREN'T
10
ALREADY APPROVED ON THE LIST OF PEOPLE WORKING ON IPHONE IN THE
11
BEGINNING.
12
AND PEOPLE WHO WORKED ON IT HAD SPECIAL MEETINGS IN
13
SPECIAL LOCATIONS AND EXTRA SECURE ROOMS AND SO ON.
14
MANY ELEMENTS OF IT THAT WERE SECRET.
THERE WERE
15
Q.
16
DEVELOPMENT PROJECT FOR THE IPHONE?
17
A.
YES.
18
Q.
DID APPLE CONSIDER THAT A, A RISKY INVESTMENT AT THE TIME?
19
A.
INCREDIBLY RISKY.
20
COMPANY."
21
Q.
22
SAW AS RISKY?
23
A.
24
HUGE RISK THIS WAS FOR APPLE.
25
WERE YOU PERSONALLY INVOLVED IN THE DECISION TO START THE
WE HAD A TERM WE CALLED "YOU BET YOUR
AND WHAT WAS IT ABOUT THAT PARTICULAR INVESTMENT THAT YOU
THERE ARE A NUMBER OF WAYS THAT WE THOUGHT ABOUT WHAT A
FIRST, APPLE HAD REALLY ONLY HAD TWO PRODUCTS AT THE TIME,
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THE MAC AND THE IPOD.
AND TO TAKE ON A WHOLE NEW PROJECT OF THIS NATURE IS, IS
RARE FOR APPLE.
PRODUCT AND HAVE ALL OF OUR BEST PEOPLE WORK ON SOMETHING.
WE DON'T WANT TO DILUTE OURSELVES ACROSS TOO MANY THINGS.
WE LIKE TO THROW OURSELVES FULLY INTO A

SO
THIS WAS AN AREA WE WERE GETTING INTO WITH NO PAST
EXPERIENCE.
HAVING NOT MADE A PHONE, WE DIDN'T KNOW ABOUT
RADIOS AND ANTENNAS AND ALL THE THINGS THAT GO INTO MAKING A
PHONE.
10
AND WE DIDN'T WANT TO HURT OUR REPUTATION AS A COMPANY
11
THAT WAS GROWING AGAIN, STARTING TO BECOME SUCCESSFUL AGAIN,
12
AND TURNING OURSELVES AROUND AND RISK ALL THAT TO DO SOMETHING
13
WE'VE NEVER DONE BEFORE.
14
Q.
WERE YOU PERSONALLY INVOLVED IN THE IPHONE DEVELOPMENT
15
PROJECT?
16
A.
YES.
17
Q.
WHAT ROLE DID YOU PLAY?
18
A.
BOTH AS A MEMBER OF THE EXECUTIVE TEAM WHERE WE ALL TALKED
19
ABOUT IT AND WERE INVOLVED IN IT, AND ALSO AS THE HEAD OF THE
20
PRODUCT MARKETING TEAM, MY TEAM WAS RESPONSIBLE FOR WORKING ON
21
ALL THE PRODUCTS, WORKING DIRECTLY HAND IN HAND WITH THE
22
ENGINEERS ON THE CHOICES AND DECISIONS ON WHAT WE'RE GOING TO
23
DO AND WHAT WE'RE GOING TO MAKE.
24
Q.
WHEN WAS THE IPHONE FIRST PUBLICLY ANNOUNCED?
25
A.
WE ANNOUNCED IT IN JANUARY AT MACWORLD 2007.
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Q.
AND WHERE WAS THAT?
A.
IN SAN FRANCISCO.
Q.
WERE YOU PERSONALLY INVOLVED IN PLANNING THAT
ANNOUNCEMENT?
A.
YES, I WAS.
Q.
DID YOU PERSONALLY PARTICIPATE IN THE ANNOUNCEMENT ITSELF?
A.
OH, YEAH, IN MANY WAYS.
8
9
I, AND MY TEAM, WERE RESPONSIBLE FOR WORKING ON THE WHOLE

PRESENTATION, THE KEYNOTE, THE DEMOS.
10
11
AND THEN ALSO I TOOK -- HAD A PERSONAL ROLE IN THE DEMO OF

THE VERY FIRST PHONE CALL ON THE IPHONE.
12
Q.
13
THINK -- FRANKLY, UNFORTUNATELY YOU WERE ON THE CUTTING ROOM
14
FLOOR.
15
ANNOUNCEMENT?
16
A.
17
OUR JURY HAS ONLY SEEN PART OF THE VIDEO, AND I DON'T
SO CAN YOU TELL US ABOUT WHAT YOUR ROLE WAS AT THE
IT WAS MY FAVORITE PART.

SO WHEN WE WERE PRESENTING THE IPHONE, ONE OF THE THINGS
18
WE WANTED TO SHOW PEOPLE WAS THAT IT WAS A BREAKTHROUGH
19
TELEPHONE AND THE EXPERIENCE OF MAKING A CALL ON IT WAS
20
SOMETHING REALLY GREAT AND FUN.
21
SO MR. JOBS WAS DOING THE KEYNOTE AND HE FIRST MADE A
22
PHONE CALL TO SIR JONATHAN IVES, THE HEAD OF OUR DESIGN TEAM,
23
WHO WAS IN THE AUDIENCE, AND STEVE SHOWED HOW TO MAKE A PHONE
24
CALL, AND WHILE HE WAS ON THAT CALL TO JONATHAN, I MADE A CALL
25
TO STEVE ALSO FROM THE AUDIENCE.
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SO YOU SAW A SECOND CALL COME IN, AND THEN STEVE WAS ABLE
TO SHOW HOW YOU SWITCH BETWEEN TWO CALLS TO JOIN THEM TOGETHER
AND MERGE THEM TOGETHER IN ONE CONFERENCE CALL.
ALL DONE WITH A WHOLE NEW EXPERIENCE.
I'M VERY PROUD OF, PART OF THE VERY FIRST PHONE CALL MADE ON
THE IPHONE PUBLICLY.
AND THIS WAS
SO I GOT TO BE SOMETHING
Q.
WAS THERE AN OVERALL THEME OF THIS KEYNOTE ANNOUNCEMENT?
A.
YES.
EVERYONE WE'RE GOING TO MAKE HISTORY TODAY.
10
FIRST, THE KEYNOTE WAS KICKED OFF WITH STEVE TELLING

WE ALL KNEW WHAT A
BIG MOMENT THIS WAS.
11
AND HE STARTED TO TALK ABOUT IPHONE, FIRST TALKING ABOUT
12
WE'RE GOING TO INTRODUCE THREE NEW PRODUCTS TODAY RATHER THAN
13
JUST ONE, AND THOSE THREE PRODUCTS WERE A REVOLUTIONARY NEW
14
PHONE, AN INTERNET COMMUNICATION DEVICE, AND THE BEST IPOD WE
15
EVER MADE, THOSE THREE THINGS.
16
17
AND, OF COURSE, THOSE THREE THINGS WERE ULTIMATELY REALLY

ONE THING THAT DID ALL OF THAT.
18
Q.
CAN YOU DESCRIBE WHAT THE ATMOSPHERE WAS AT THIS
19
ANNOUNCEMENT?
20
A.
21
THE ENERGY AND FEELING IN THE ROOM.
22
Q.
WAS THERE A VIDEO THAT WAS MADE OF THE ANNOUNCEMENT?
23
A.
YES.
24
Q.
SIR, YOU HAVE A WHITE BINDER IN FRONT OF YOU THAT CONTAINS
25
EXHIBITS.
I THINK THE WORD I ALWAYS THINK OF IS ELECTRIC.
WOULD YOU OPEN IT UP, PLEASE, TO EXHIBIT,
THAT WAS
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A.
OKAY.
Q.
CAN YOU TELL ME WHAT THAT IS, PLEASE?
A.
THIS IS A DVD WITH A VIDEO FROM THAT ANNOUNCEMENT.
5
6
MR. MCELHINNY:
YOUR HONOR, I MOVE THE ADMISSION OF
MR. PRICE:
NO FURTHER OBJECTION.
THE COURT:
ALL RIGHT.
IT'S ADMITTED.
(PLAINTIFF'S EXHIBIT 118 WAS ADMITTED IN EVIDENCE.)
10
THE COURT:
GO AHEAD, PLEASE.
11
BY MR. MCELHINNY:
12
Q.
13
THE PRESS ATTEND?
14
ATTEND THE ANNOUNCEMENT?
15
A.
16
AND THE REACTION WAS ENORMOUS.
17
CAN IMAGINE IN PRESS AND ONLINE.
18
Q.
19
POSITIVE?
20
A.
21
THAT THIS WAS ONE OF THE MOST AMAZING BREAKTHROUGHS EVER, AND
22
THERE WERE FEELINGS FROM SOME WHO THOUGHT IT WAS THE BIGGEST
23
MISTAKE AND WE WERE GOING TO FALL FLAT ON OUR FACE.
24
Q.
25
FAILURE OF THE IPHONE?
SIR, WAS THERE A PUBLIC REACTION TO THE ANNOUNCEMENT?
DID
I SHOULD ASK THAT QUESTION, DID THE PRESS
OH, YES, THERE WERE MANY PRESS IN ATTENDANCE AT THE EVENT,

IT WAS COVERED BY EVERYONE I
WAS THE INITIAL REACTION TO THE ANNOUNCEMENT, WAS IT ALL
OH, NOT AT ALL.
IT WAS VERY MIXED.
THERE WERE FEELINGS
CAN YOU GIVE US SOME EXAMPLES OF PEOPLE WHO PREDICTED
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A.
MR. BOTTOMER, THEN CEO OF MICROSOFT SAID SOME PRETTY MEAN
THINGS ABOUT HOW WE WERE GOING TO FAIL WITH IT.
NOT SURPRISINGLY MOST OF OUR COMPETITORS DID,
WE HEARD COMMENTS FROM NOKIA, FROM A SMARTPHONE MAKER AT
THE TIME, PALM, SAID THAT WE CAN'T JUST COME UP AND MAKE A
PHONE THE VERY FIRST TIME OUT AND SO ON.
7
8
9
THERE WERE NO END TO THE LIST OF PEOPLE WHO SAID THIS

WOULD FAIL.
Q.
WOULD YOU LOOK IN YOUR BINDER, PLEASE, TO PLAINTIFF'S
10
EXHIBIT 135A.
11
A.
OKAY.
12
Q.
CAN YOU TELL ME WHAT THAT IS, PLEASE?
13
A.
THIS IS AN ARTICLE FROM THE "NEW YORK TIMES" DATED
14
JANUARY 11TH, 2007.
15
Q.
AND IS THIS PUBLIC REACTION TO THE ANNOUNCEMENT ITSELF?
16
A.
YES.
17
WRITTEN BY MR. DAVID POGUE, AND IT DESCRIBES HIS THOUGHTS OF
18
THAT.
19
Q.
20
21
22
THIS IS A NEWS STORY ABOUT THE LAUNCH AT THAT TIME
JUST A MINUTE.
YOUR HONOR, I MOVE THE ADMISSION OF PLAINTIFF'S EXHIBIT
135A.
MR. PRICE:
NO FURTHER OBJECTION, AND WE REQUEST A
23
LIMITING INSTRUCTION AS TO THIS NOT BEING ENTERED FOR THE TRUTH
24
OF THE MATTER.
25
THE COURT:
THIS IS NOT ADMITTED FOR THE TRUTH OF THE
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MATTER, BUT IT IS ADMITTED.
(PLAINTIFF'S EXHIBIT 135A WAS ADMITTED IN EVIDENCE.)
THE COURT:
GO AHEAD, PLEASE.
MR. MCELHINNY:
THANK YOU.
Q.
SIR, WE'VE PUT ON THE -- WE'VE PUT THE ARTICLE ON THE
SCREEN AND WE'VE ALSO PUT ON A DEMONSTRATIVE.
DEMONSTRATIVE -- WE DON'T HAVE THE TIME TO READ ALL OF THESE
ARTICLES.
DEMONSTRATIVE TO EXPLAIN SOME OF THE SALIENT POINTS, OR THE
THE JURY WILL HAVE THEM.
10
SALIENT POINT.
11
A.
12
13
CAN YOU USE THIS
CAN YOU USE THIS
YES I CAN.
AS YOU SEE, IT'S FROM THE "NEW YORK TIMES," THE TITLE OF
THE ARTICLE WAS "APPLE WAVES ITS WAND AT THE PHONE."
14
YOU SEE A PICTURE OF THE IPHONE BEING HELD IN A HAND, AND
15
ONE OF THE QUOTES FROM THE ARTICLE IS "THIS MACHINE IS SO
16
PACKED WITH POSSIBILITIES THAT THE CELL PHONE MAY ACTUALLY BE
17
THE LEAST INTERESTING PART."
18
Q.
SIR, DID THE PRESS COVERAGE CONTINUE AFTER THE FIRST WEEK
19
FOLLOWING MACWORLD ANNOUNCEMENT?
20
A.
YES, IT DID.
21
Q.
SO THE PHONE WAS ANNOUNCED IN JANUARY.
22
RELEASED FOR SALE?
23
A.
THAT SUMMER, IN JUNE OF 2007.
24
Q.
WHAT ACCOUNTED FOR THE SIX MONTHS IN BETWEEN?
25
A.
WELL, THAT'S, FIRST, THE AMOUNT OF TIME IT TOOK US TO
WHEN WAS IT FIRST
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COMPLETE THE PRODUCT AND START TO BUILD THEM AND GET THEM READY
FOR SALE.
Q.
JANUARY ANNOUNCEMENT AND THE JUNE RELEASE TO PROMOTE THE
IPHONE?
A.
YES, WE DID.
Q.
AND WHAT DID YOU DO, SIR?
A.
WELL, FIRST, IN THE BEGINNING WE DID NOTHING FOR MANY
WEEKS.
10
DID APPLE DO ANYTHING IN THAT SIX MONTHS BETWEEN THE
WE ACTUALLY HAD A STRATEGY OF GOING SILENT.
AND THIS WAS BECAUSE THE PRESS COVERAGE WAS SO ENORMOUS
11
AND SO POSITIVE ABOUT THE EXCITEMENT AROUND THE PRODUCT THAT WE
12
THOUGHT TO JUST LET THAT GO OUT THERE.
13
ADD TO THE EXCITEMENT.
THERE WAS NOT A LOT TO
14
AND THEN TO PREPARE CUSTOMERS FOR THE ARRIVAL OF IPHONE
15
FOR SALE AS WE GOT CLOSER TO JUNE, WE DID END UP WITH SOME TV
16
ADVERTISEMENTS.
FIRST WE DID A TEASER AD AS WE CALL IT ON THE
17
ACADEMY AWARDS.
IT WAS JUST CALLED HELLO, AND IT SHOWED PEOPLE
18
ANSWERING THE PHONE.
19
20
AND THEN AS WE GOT CLOSER TO THE LAUNCH OF THE IPHONE, WE

STARTED TO CREATE ACTUAL TV ADS ABOUT THE IPHONE.
21
Q.
SIR, WOULD YOU LOOK IN YOUR BINDER, PLEASE, AT PLAINTIFF'S
22
EXHIBIT 180.
23
A.
YES.
24
Q.
WHAT IS THAT, SIR?
25
A.
THIS IS A DVD ABOUT THE FIRST ADS WE CREATED TO LAUNCH THE
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IPHONE.
MR. MCELHINNY:
MR. PRICE:
THE COURT:
ALL RIGHT.
IT'S ADMITTED AND IT IS --
10
AND AGAIN,
YOU ARE NOT TO CONSIDER IT FOR ITS TRUTH.
NO FURTHER OBJECTIONS.
LIMITING PURPOSE.
5
6
YOUR HONOR, I MOVE PDX 180, PLEASE.
THE COURT:
GO AHEAD, PLEASE.
BY MR. MCELHINNY:
Q.
11
MR. SCHILLER, I'D LIKE TO SHOW IT FOR THIS AD, PLEASE.

12
MR. MCELHINNY:
NOW CAN WE SEE THEM TOGETHER?
13
(LAUGHTER.)
14
15
BY MR. MCELHINNY:
16
Q.
SIR, THAT WAS THE FIRST AD THAT YOU DID; IS THAT CORRECT?
17
A.
YES.
18
Q.
DO YOU RECALL WHAT THE TITLE OF THAT AD WAS?
19
A.
HOW TO.
20
Q.
HOW TO.
21
STARTED WITH THE SLIDE TO UNLOCK FEATURE?
22
A.
ABSOLUTELY.
23
Q.
WAS THAT INTENTIONAL?
24
A.
YES, IT WAS.
25
Q.
CAN YOU EXPLAIN THE LOGIC BEHIND THAT CHOICE, PLEASE?
WAS THERE ANY SIGNIFICANCE TO THE FACT THAT IT
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A.
ACTUALLY USE AN IPHONE FOR THEMSELVES, AND SO THEY'VE NEVER
USED AT THIS POINT IN TIME A DEVICE ANYTHING LIKE IT.
WHEN THIS AD RAN, PEOPLE HADN'T HAD THE OPPORTUNITY YET TO
THE CHALLENGE IS HOW DO YOU SHOW PEOPLE, IN A SIMPLE,
30-SECOND AD, SOMETHING THAT GIVES THEM A FEEL FOR WHAT IT'S
LIKE TO USE THIS NEW GENERATION OF APPLE'S SMARTPHONE.
AND WE STARTED THE AD WITH SOMETHING YOU'RE GOING TO BE
DOING EVERY DAY, MANY, MANY TIMES A DAY, WHICH IS TO UNLOCK THE
SCREEN, AND TO DO THAT, YOU USE A SIMPLE GESTURE, SLIDE TO
10
UNLOCK.
11
AND THAT ONE GESTURE, HAVING SEEN THAT ONE THING FIRST,
12
YOU GET AN INSTANT IDEA OF HOW MULTITOUCH WORKS SO THAT YOU'RE
13
DOING A GESTURE ON THE SCREEN, AND IT DOES SOMETHING SIMPLE AND
14
USEFUL TO YOU, AND THAT IT'S EASY TO USE.
15
MANUAL TO FIGURE IT OUT.
YOU DON'T NEED A
16
AND THAT ONE STARTING POINT WAS A GREAT BEGINNING TO YOUR
17
UNDERSTANDING OF WHAT AN IPHONE IS AND WHAT THIS KIND OF DEVICE
18
CAN DO.
19
Q.
HAD YOU IDENTIFIED UNIQUE RISKS IN TRYING TO BRING A
20
MULTITOUCH PRODUCT TO MARKET IN 2007?
21
A.
OH, YES, WE DID.
22
Q.
AND WHAT WERE THE RISKS THAT WERE SPECIFIC TO THAT KIND OF
23
A PRODUCT?
24
A.
25
EITHER HAD A NUMERIC KEY PAD, FEATURES PHONES WOULD HAVE A TEN
WELL, UNTIL THE IPHONE, THE MAJORITY OF PHONES OUT THERE
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DIGIT KEYPAD, OR HAD A PHYSICAL KEYBOARD ON IT FOR NOT ONLY
DIALLING, BUT TYPING ON IT AS WELL, AND PEOPLE WERE VERY
FAMILIAR WITH THAT AND COMFORTABLE WITH THAT.
THE IDEA THAT YOU WOULD NOW GO TO A FULL GLASS SCREEN THAT
YOU WOULD TOUCH WITH YOUR FINGERS AND CONTROL TO TYPE AND MAKE
GESTURES WAS, WAS PRETTY UNUSUAL AND RISKY AND MANY PEOPLE
CALLED THAT OUT AS PERHAPS THE GREATEST RISK TO IPHONE IS HOW
YOU WOULD HAVE AN EASY TO USE, POWERFUL EXPERIENCE ON THIS
MULTITOUCH DISPLAY.
10
Q.
11
WOULD YOU AGREE WITH ME ABOUT THAT?
12
A.
YES.
13
Q.
AND HOW DID YOU OVERCOME THESE RISKS AND CHALLENGES?
14
IS IT ABOUT THAT, THE PRODUCT, THAT YOU THINK NOW IN RETROSPECT
15
MADE IT SUCCESSFUL?
16
A.
17
18
19
20
21
22
23
24
25
OBVIOUSLY IN RETROSPECT THE PRODUCT HAS BEEN SUCCESSFUL.
WHAT
WELL, A LOT WENT INTO MAKING IT SUCCESSFUL.

MR. PRICE:
OBJECTION.
CALLS FOR IMPROPER OPINION
TESTIMONY.
THE COURT:
OVERRULED.
GO AHEAD, PLEASE.
THE WITNESS:
YOU MAY ANSWER.

A LOT OF THINGS WENT INTO MAKING THE
IPHONE SUCCESSFUL.
TO ME, I THINK IT'S THIS INCREDIBLE, BEAUTIFUL DESIGN.
PEOPLE LOVED HOW IT LOOKS.
THAT IT DOES THINGS THAT YOU'VE NEVER BEEN ABLE TO DO
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BEFORE AT THE TIME WITH PHONES, ALL THIS INTERNET CAPABILITIES
AND ITS IPOD USEFULNESS.
BUT MOST OF ALL, THAT THIS PIECE OF GLASS THAT COMES ALIVE
WITH SOFTWARE IS, IS EASY TO USE, IS FUN TO USE, AND DOES ALL
THESE NEW ACTIONS FOR YOU WITHOUT HAVING TO BE TRAINED OR
TAUGHT.
7
8
IT'S INTUITIVE AND EASY TO USE AND POWERFUL AND FUN.
AND MAKING THAT WHOLE EXPERIENCE, IT JUST ADDS UP TO AN

EXPERIENCE THAT'S UNIQUE AND USEFUL TO PEOPLE.
ULTIMATELY, I THINK THAT DROVE ITS SUCCESS.
10
BY MR. MCELHINNY:
11
Q.
12
WENT ON SALE?
13
A.
14
BIG DAY.
15
CHOSE TO GO TO CHICAGO.
16
MICHIGAN AVENUE, AND I WENT THERE AND BROUGHT MY SON WITH ME
17
BECAUSE I KNEW IT WOULD BE A BIG DAY FOR BOTH OF US, AND WE
18
WERE THERE TO BE PART OF THE EXCITEMENT OF THE FIRST SALES OF
19
IPHONE.
20
Q.
21
EACH OF THE MAJOR SALES LOCATIONS?
22
A.
23
ENERGY, THE NEWNESS OF A DEVICE LIKE IPHONE COMING INTO THE
24
MARKET WAS GOING TO BE FELT AROUND THE COUNTRY, AND WE WANTED
25
TO BE EVERYWHERE WE COULD AND SEE AND FEEL THAT AS WELL.
WHERE WERE YOU PERSONALLY ON THE DAY THAT THE IPHONE FIRST
WHEN IT FIRST WENT ON SALE, I AND MY TEAM KNEW IT WAS A

SO WE FANNED TO DIFFERENT SELLING LOCATIONS, AND I
WE HAVE AN APPLE RETAIL STORE ON
AND WHY DID YOU HAVE SOMEBODY FROM THE ORGANIZATION GO TO
BECAUSE FOR US THIS WAS A HISTORIC DAY.
THE CROWDS, THE
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Q.
AFTER THE IPHONE WAS RELEASED, DID YOU SEE ANY REVIEWS OF
PEOPLE WHO HAD ACTUALLY -- BY REPORTERS OR PROFESSIONALS WHO
HAD ACTUALLY USED THE PHONE AND WERE REVIEWING IT?
A.
YES.
Q.
IF YOU OPEN YOUR BINDER, PLEASE, TO EXHIBIT PDX 144A AS IN
ALBERT.
A.
OKAY.
Q.
CAN YOU TELL US WHAT THAT IS, PLEASE?
A.
THIS IS A SUMMARY OF SOME OF THE NEWS COVERAGE ABOUT
10
IPHONE.
11
Q.
12
MANY PAGES IS IT?
13
A.
IT IS SIX PAGES LONG.
14
Q.
AND DOES IT HAVE EXCERPTS OF VARIOUS ARTICLES?
15
RIGHT?
16
A.
AND BE MORE SPECIFIC.
WHAT DO YOU MEAN BY A SUMMARY?
HOW
IS THAT
IT DOES.
17
MR. MCELHINNY:
18
MR. PRICE:
YOUR HONOR, WE MOVE PDX 144A.
NO FURTHER OBJECTION, AGAIN, WITH A
19
FURTHER LIMITING INSTRUCTION THAT IT'S NOT TO BE USED FOR THE
20
TRUTH OF WHAT'S SAID.
21
22
THE COURT:
THIS IS ADMITTED, BUT IT'S NOT TO BE
CONSIDERED FOR THE TRUTH OF WHAT IS SAID.
23
24
BY MR. MCELHINNY:
25
Q.
JUST SO THE JURY WILL RECOGNIZE IT, CAN WE DO WHAT WE'VE
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DONE, PUT THE FIRST PAGE UP.
CAN YOU JUST EXPLAIN TO US WHAT THIS SUMMARY IS.
A.
YES.
YOU CAN SEE LISTED ON, FOR EXAMPLE, THE FIRST PAGE
FOUR DIFFERENT EXAMPLES OF SEPARATE NEWS COVERAGE, EACH ONE
ABOUT THE IPHONE.
CHRONICLE, ANOTHER FROM THE "NEW YORK TIMES," ANOTHER FROM
"U.S.A. TODAY," AND A FOURTH ONE FROM THE "NEW YORK TIMES"
AGAIN ON THIS ONE PAGE.
Q.
THERE'S ONE FROM THE SAN FRANCISCO
CAN YOU LOOK IN YOUR BINDER, PLEASE, AND SEE PLAINTIFF'S
10
EXHIBIT 113A?
11
A.
YES.
12
Q.
CAN YOU TELL ME WHAT 113A IS, PLEASE.
13
A.
THIS IS A REVIEW OF THE IPHONE THAT APPEARED IN THE
14
"WALL STREET JOURNAL" DATED JUNE 27TH, 2007.
15
16
17
MR. MCELHINNY:
YOUR HONOR, I MOVE THE ADMISSION OF
113A.
MR. PRICE:
AND, AGAIN, NO FURTHER OBJECTIONS, YOUR
18
HONOR, AND WITH A LIMITING INSTRUCTION NOT TO BE CONSIDERED FOR
19
THE TRUTH.
20
21
THE COURT:
OKAY.
IT'S NOT TO BE CONSIDERED FOR THE
TRUTH OF WHAT IS STATED.
22
BUT IT'S ADMITTED.
23
24
THE COURT:
GO AHEAD, PLEASE.
25
MR. MCELHINNY:
THANK YOU.
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Q.
GOING TO SHOW YOU A DEMONSTRATIVE, PDX 2, WHICH WE'VE CREATED.
CAN YOU USE THE DEMONSTRATIVE, PLEASE, AND USE IT TO GIVE US
THE SALIENT POINTS THE ARTICLE.
MR. SCHILLER, I'M SHOWING YOU FIRST 113A AND THEN I'M
FIRST, WHO IS WALTER MOSSBERG.
A.
THIS ARTICLE WAS WRITTEN BY WALTER MOSSBERG AND KATHERINE
BOEHRET.
REVIEWER IN THE "WALL STREET JOURNAL" AND IS ONE OF THE BEST
KNOWN TECHNOLOGY COLUMNISTS IN OUR COUNTRY.
AND MR. MOSSBERG HAS BEEN A LONG-TIME PRODUCT
10
Q.
11
ARTICLE FOR THE JURY, PLEASE.
12
A.
13
IPHONE."
14
CAN YOU USE THE DEMONSTRATIVE, PLEASE, TO ILLUMINATE THE
YES.
THE TITLE OF THE ARTICLE IS "TESTING OUT THE
YOU SEE AN IMAGE THERE OF FIVE IPHONES SHOWING DIFFERENT
15
USES ON THE SCREEN.
16
RIGHT THAT APPEARED IN THE ARTICLE THAT SHOWED THE IPHONE
17
AGAINST AND COMPARED TO COMMON COMPETITIVE PRODUCTS AT THE
18
TIME.
19
DEMONSTRATIVE.
20
YOU ALSO SEE A TABLE HERE ON THE BOTTOM
AND THERE ARE TWO QUOTES CALLED OUT IN THIS
THE FIRST IS "THE IPHONE IS, ON BALANCE, A BEAUTIFUL AND
21
BREAKTHROUGH HANDHELD COMPUTER.
22
A NEW BAR FOR THE SMARTPHONE INDUSTRY."
23
24
25
ITS SOFTWARE, ESPECIALLY, SETS
AND THE SECOND QUOTE IS "THE IPHONE IS A WHOLE NEW

EXPERIENCE AND A PLEASURE TO USE."
Q.
SIR, IF YOU LOOK AT THE FOUR PHONES, DO YOU SEE THAT'S THE
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SAMSUNG BLACKJACK?
A.
YES, I DO.
Q.
IS THAT WHAT THE BLACKJACK LOOKED LIKE IN 2007?
A.
YES, IT DID.
Q.
THANK YOU.
IN YOUR BINDER, CAN YOU TELL US WHAT THAT IS?
A.
"NEW YORK TIMES," ALSO DATED JUNE 27TH, 2007.
THIS IS ANOTHER PRODUCT REVIEW, THIS ONE FROM THE
MR. MCELHINNY:
10
11
SIR, IF YOU WOULD PLEASE TURN TO EXHIBIT 127A
MR. PRICE:
YOUR HONOR, I MOVE 127A.
AGAIN, NO FURTHER OBJECTIONS AND NOT TO
BE OFFERED FOR THE TRUTH OF THE MATTERS ASSERTED.
12
THE COURT:
ALL RIGHT.
IT IS ADMITTED, AND IT'S NOT
13
TO BE CONSIDERED FOR THE TRUTH OF THE MATTER STATED IN THE
14
ARTICLE.
15
16
THE COURT:
GO AHEAD, PLEASE.
17
BY MR. MCELHINNY:
18
Q.
19
GOING TO PUT ON DEMONSTRATIVE PDX 3, AND CAN YOU USE THIS TO
20
SUMMARIZE THE ARTICLE FOR?
21
A.
22
ITS HYPE," WRITTEN BY DAVID POGUE, JUNE 27TH, 2007.
23
SIR, WE'VE PUT THE ARTICLE ON THE BOARD, BUT NOW WE'RE
YES.
THIS ARTICLE WAS TITLED "THE IPHONE MATCHES MOST OF
TWO OF THE QUOTES IN THE ARTICLE ARE "UNLESS YOU'VE BEEN
24
IN A SENSORY-DEPRIVATION TANK FOR SIX MONTHS, YOU KNOW WHAT THE
25
IPHONE IS:
A TINY, GORGEOUS HAND-HELD COMPUTER WHOSE SCREEN IS
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A SLAB OF TOUCH-SENSITIVE GLASS.
"AND THE BIGGER ACHIEVEMENT IS THE SOFTWARE.
BEAUTIFUL, MENU-FREE, AND DEAD SIMPLE TO OPERATE."
Q.
PX 133.
A.
APPEARED IN 2007.
SIR, WOULD YOU PLEASE LOOK IN YOUR BINDER AT EXHIBIT

CAN YOU TELL US WHAT THAT EXHIBIT IS, PLEASE.
YES.
THIS IS A SPECIAL ARTICLE IN "TIME MAGAZINE" THAT
MR. MCELHINNY:
MR. PRICE:
YOUR HONOR, I MOVE EXHIBIT PX 133.
NO FURTHER OBJECTIONS AND NOT FOR THE
10
TRUTH OF THE MATTER ASSERTED.
11
THE COURT:
12
IT'S FAST,
ALL RIGHT.
IT IS ADMITTED AND NOT TO BE
CONSIDERED FOR THE TRUTH OF WHAT'S STATED IN THE ARTICLE.
13
14
THE COURT:
GO AHEAD, PLEASE.
15
BY MR. MCELHINNY:
16
Q.
17
USE THAT TO HELP US UNDERSTAND SO WE'VE GOT A SUMMARY OF WHAT
18
WAS IN THE ARTICLE.
19
A.
20
ABOUT THE BEST INVENTIONS OF 2007, AND IN THIS STORY, THEY
21
AWARDED IPHONE THE INVENTION OF THE YEAR FOR 2007.
22
SIR, LET ME PUT A DEMONSTRATIVES UP, PDX 4, AND CAN YOU
YES.
THIS STORY IN "TIME MAGAZINE" WAS AN ANNUAL STORY
AND AS YOU SEE IN THE DEMONSTRATIVE THERE IS -- THE COVER
23
OF "TIME MAGAZINE," THIS IS PRETTY AMAZING THAT IN NOVEMBER OF
24
2007, THEY PLACED IPHONE ON THE COVER.
25
PRODUCTS ON THE COVER OF "TIME MAGAZINE."
YOU DON'T USUALLY SEE
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THEY ALSO HAD FUN WITH THE ICONS ON THE HOME SCREEN ON THE
ARTICLE AND SPELLED OUT THE TITLE OF THE ARTICLE, "BEST
INVENTIONS OF 2007."
4
5
AND THERE ARE THREE QUOTES HERE DIRECTLY FROM THAT

ARTICLE.
THE FIRST IS "TOUCHY FEELY."
THE SECOND, "APPLE'S ENGINEERS USED A TOUCHSCREEN INNOVATE
PAST THE GRAPHICAL USER INTERFACE (WHICH APPLE HELPED PIONEER
WITH THE MACINTOSH IN THE 1980S) TO CREATE A WHOLE NEW KIND OF
INTERFACE."
10
AND "THIS IS, AS ENGINEERS SAY, NONTRIVIAL."
11
Q.
SIR, WOULD YOU LOOK PLEASE AT PX 134?
12
A.
YES.
13
Q.
WHAT IS EXHIBIT 134?
14
A.
IT IS A STORY FROM THE TECHNOLOGY SECTION OF THE
15
"NEW YORK TIMES" THAT APPEARED IN NOVEMBER OF 2011.
16
Q.
DID YOU SAY 2011?
17
A.
YES.
18
Q.
OKAY.
19
20
21
22
23
24
25
YOUR HONOR, I MOVE PX 134.

MR. PRICE:
NO FURTHER OBJECTIONS AND AGAIN NOT FOR
THE TRUTH OF THE MATTER ASSERTED.

THE COURT:
ALL RIGHT.
IT'S ADMITTED AND IT'S NOT TO
BE CONSIDERED FOR THE TRUTH OF WHAT'S STATED.

BY MR. MCELHINNY:
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Q.
DEMONSTRATIVES, PDX 5.
HELP SUMMARIZE THE ARTICLE FOR US, PLEASE.
A.
SPECIAL.
INNOVATIONS" AND THE U.S. PATENT AND TRADEMARK OFFICE CREATED
AN EXHIBIT ABOUT STEVE JOBS'S PATENTS AND INVENTIONS, AND IN
DOING THAT, THEY SET UP DISPLAYS WITH, WITH PATENTS ON THEM,
ABOUT A DOZEN ON EACH ONE, AND THEY DESIGNED THEM TO LOOK JUST
10
11
SIR, HERE'S THE ARTICLE, 134, AND WE'VE GOT A
YES.
AND CAN YOU USE THE DEMONSTRATIVES TO
THIS IS AN ARTICLE THAT, FOR ME, IS SOMETHING PRETTY

IT WAS TITLED "PATENT OFFICE HIGHLIGHTS JOBS'S
LIKE THE PHONE.

SO YOU'D WALK INTO THIS EXHIBIT, YOU'D SEE AN IMAGE OF
12
STEVE AND YOU'D SEE MANY, MANY, MANY OF HIS PATENTS ALL THERE,
13
AND THAT'S WHAT THAT PHOTO REPRESENTS.
14
AND TWO OF THE PARAGRAPHS FROM THAT ARTICLE READ "THE
15
UNITED STATES PATENT AND TRADEMARK OFFICE IN ALEXANDRIA,
16
VIRGINIA RECENTLY UNVEILED AN EXHIBIT OF 30 GIANT IPHONE-LIKE
17
MODELS HONORING THE INVENTIONS OF THE LATE STEVE JOBS.
18
ALTOGETHER ABOUT 300 PATENTS ARE AN DISPLAY, GIVING EXHIBIT
19
ATTENDEES A VISUAL TOUR THROUGH APPLE'S HISTORY OF DESIGN AND
20
INNOVATION.
21
"PATENTS ON TECHNOLOGICAL DEVICES DO NOT ALWAYS RESULT IN
22
REAL PRODUCTS THAT HIT THE CONSUMER MARKET, BUT THEY DOCUMENT
23
AN INVENTOR'S RESEARCH AND METHODOLOGY IN DIFFERENT AREAS OF
24
DESIGN AND ENGINEERS.
25
COME TOGETHER TO FORM ONE REAL PRODUCT, LIKE THE IPAD."
OFTEN, MULTIPLE PATENTED TECHNOLOGIES
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Q.
SIR, WHAT'S THE SIGNIFICANCE OF THIS SECOND QUOTE?
A.
WELL, THE SECOND QUOTE TALKS ABOUT --
MR. PRICE:
YOUR HONOR, I'M GOING TO OBJECT TO LACK
OF FOUNDATION, SPECULATION.
ARTICLE SAYS.
THE COURT:
MR. MCELHINNY:
IT'S INTERPRETING WHAT THIS
LAY A FOUNDATION IF HE KNOWS.

I'LL REPHRASE IT.
Q.
SIR, IN YOUR VIEW, BASED ON YOUR EXPERIENCE AT APPLE AND
YOUR KNOWLEDGE OF THE PROCESS, DO YOU FIND SIGNIFICANCE IN THAT
10
SECOND QUOTE?
11
A.
YES, I DO.
12
Q.
WHAT IS THE SIGNIFICANCE THAT YOU FIND, SIR?
13
14
15
MR. PRICE:
THE SIGNIFICANCE OF THAT QUOTE.

THE COURT:
16
OVERRULED.
17
GO AHEAD.
18
I'LL OBJECT TO RELEVANCE WITH HIS VIEW OF
ALL RIGHT.
YOU MAY ANSWER.
THE WITNESS:
AS WE WORK ON PRODUCTS AT APPLE AND THE
19
DEVELOPMENT PROCESSES, AS WE DISCUSSED EARLIER, IT TAKES YEARS,
20
IT INVOLVES MANY HUNDREDS OF ENGINEERS AND PEOPLE WORKING
21
TOGETHER, AND THESE INVENTIONS, MANY OF THEM ARE PATENTED AND
22
THEY APPEAR IN THE PRODUCT, THROUGHOUT TIME, AT DIFFERENT
23
TIMES, SOMETIMES RIGHT AWAY, SOMETIMES NOT UNTIL MUCH LATER .
24
THEY'RE ALL PART OF A PROCESS THAT OCCURS.
25
AND SOMETIMES ALL THOSE PATENTS, A LOT OF PATENTS ALL COME
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TOGETHER TO MAKE ONE PRODUCT AS THIS SAYS.
2
3
THAT'S NOT ALWAYS THE CASE.
IT VARIES AND EACH CASE IS
UNIQUE.
BY MR. MCELHINNY:
Q.
HAVE GIVEN US AN EXAMPLE, BUT IS IT A LINEAR PROCESS, ONCE YOU
START ON A PRODUCT, YOU WORK ON IT TO THE END AND THEN YOU WORK
ON A NEW PRODUCT FROM THE BEGINNING TO THE END?
LIKE THAT?
YOU MENTIONED THE APPLE NEW PRODUCT PROCESS, AND YOU MAY
10
A.
11
MILESTONES IN THEM THAT ARE LAID OUT.
12
NO.
IS IT IN ORDER
THERE IS A PROCESS WE FOLLOW THAT HAS VERY RIGID
BUT THE DEVELOPMENT WORK HAPPENS THROUGHOUT.
TIME THINGS
13
ARE INVENTED EARLY IN THE PROCESS, SOMETIMES LATER IN THE
14
PROCESS.
15
PARALLEL TOGETHER AT DIFFERENT STAGES OF THE DEVELOPMENT.
16
17
THERE ARE MULTIPLE PROGRAMS AT ANPP GOING ON IN
SO IT IS A FORMAL PROCESS WITH MANY ELEMENTS HAPPENING IN

PARALLEL.
18
Q.
DID THE IPHONE DEVELOPMENT PROCESS RESULT IN INVENTIONS
19
THAT WEREN'T IMMEDIATELY INCORPORATED INTO THE IPHONE?
20
A.
YES, OF COURSE.
21
Q.
AND FROM APPLE'S PERSPECTIVE, ARE THOSE INVENTIONS STILL
22
VALUABLE TO APPLE?
23
A.
24
INVENTING NEW VERSIONS OF THE IPHONE, NEW VERSIONS OF OUR
25
OPERATING SYSTEM.
EXTREMELY.
WE'RE STILL IN A MARKET HERE WHERE WE'RE
IT'S STILL GROWING AND THERE'S SO MUCH MORE
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TO DO TO HELP CUSTOMERS AND CREATE NEW VALUE IN OUR BUSINESS.
IT'S LONG FROM OVER.
Q.
SIR, LET'S MOVE TO A SLIGHTLY DIFFERENT SUBJECT.

WHAT WERE THE SALES FIGURES LIKE FOR THE ORIGINAL IPHONE?
A.
THEY WERE REALLY GREAT.
Q.
HAVE YOU PREPARED A SUMMARY FOR THIS JURY WHICH SHOWS
THOSE SALES NUMBERS?
A.
YES.
MR. MCELHINNY:
YOUR HONOR --
10
Q.
OR WOULD YOU OPEN YOUR BINDER, PLEASE, TO PX 143.
11
A.
OKAY.
12
Q.
WHAT IS PX 143?
13
A.
THIS IS A CHART THAT WE PREPARED OF CUMULATIVE UNIT SALES
14
OF THE IPHONE AND IPAD.
15
MR. MCELHINNY:
16
YOUR HONOR, I MOVE PLAINTIFF'S
EXHIBIT 143.
17
MR. PRICE:
NO FURTHER OBJECTION.
18
THE COURT:
IT'S ADMITTED.
19
20
THE COURT:
GO AHEAD, PLEASE.
21
MR. MCELHINNY:
22
THERE.
23
Q.
24
SALES FOR THE IPHONES?
25
A.
ALL RIGHT.
WE'LL PUT IT ON THE BOARD
SO CAN YOU -- WHERE DO WE FIND THERE AT LEAST THE INITIAL
SO THIS IS A CHART OF CUMULATIVE SALES, SO SALES AS
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THEY'RE GROWING OVER TIME.
UNITS, AND TIME IS ALONG THE BOTTOM SCALE, FROM 2007 AT THE
BEGINNING OF THE IPHONE UNTIL LATE 2013.
4
5
THE VERTICAL SCALE IS MILLIONS OF
AND THE BLUE LINE REPRESENTS THE CUMULATIVE SALES OF

IPHONE WITH EACH QUARTERLY TOTAL OF SALES.
Q.
AND CAN YOU SUMMARIZE FOR US WHAT THE ORIGINAL, THE SALES
OF THE ORIGINAL IPHONE WERE?
A.
QUARTER, WE SOLD THE IPHONE, WE STARTED QUITE MODESTLY WITH
YES.
AS YOU CAN SEE IN THE BEGINNING, THE VERY FIRST
10
300,000 UNITS, A GREAT LAUNCH FOR US, BUT WE HAD NO IDEA WHERE
11
IT WAS ALL GROWING.
12
OVER A MILLION AND THEN OVER 5 MILLION AT THE START OF 2008,
13
OVER 10 MILLION AT THE START OF 2009, AND ON AND ON.
14
THE COURT:
AND YOU CAN SEE IT GREW VERY QUICKLY TO
CAN I ASK YOU ONE QUESTION.
WHEN YOU
15
KEEP SAYING "NO FURTHER OBJECTION," THERE WAS NO OBJECTION
16
FILED TO SOME OF THESE.
17
KNOW?
18
WHAT ARE YOU PRESERVING, JUST SO I
MR. PRICE:
THE MOTIONS IN LIMINE OBJECTIONS, YOUR
THE COURT:
OKAY.
22
MR. PRICE:
PARDON ME?
23
THE COURT:
THEY WERE NOT TO EVERY SINGLE EXHIBIT,
19
HONOR.
20
21
24
25
THEY WERE NOT TO EVERY SINGLE
EXHIBIT.
BUT LET'S TALK ABOUT THIS LATER.

MR. PRICE:
SURE.
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THE COURT:
ALL RIGHT.
MR. MCELHINNY:
GO AHEAD, PLEASE.
THANK YOU.
Q.
DOES THIS CHART ALSO SHOW THE SALES OF SUBSEQUENT MODELS
OF THE IPHONE AFTER THE ORIGINAL IPHONE?
A.
YEAR'S SALES HAVE ACCELERATED AND GROWN THROUGHOUT THIS TIME.
Q.
2013?
A.
IT DOES.
WITH EACH YEAR, THERE WERE NEW MODELS AND EACH
AND CAN YOU TELL US WHAT THE TOTAL WAS THROUGH THE END OF
YES.
YOU CAN SEE AT THE TOP RIGHT CORNER ON THAT, AT THE
10
VERY HIGHEST POINT OF THAT BLUE LINE, IT'S JUST SHY OF 170
11
MILLION UNITS.
12
Q.
13
YOU OBSERVE CHANGES IN THE PHONE MARKETPLACE AS A RESULT OF THE
14
INTRODUCTION OF THE IPHONE?
15
A.
YES.
16
Q.
AND CAN YOU DESCRIBE THOSE CHANGES FOR US?
FROM YOUR POSITION AS THE HEAD OF MARKETING AT APPLE, DID
17
MR. PRICE:
OBJECTION.
18
THE COURT:
OVERRULED.
19
20
VAGUE, AMBIGUOUS.
GO AHEAD, PLEASE.
THE WITNESS:
WHAT WE HOPED FOR, WHAT WE EXPECTED TO
21
HAVE HAPPEN DID, IN FACT, OCCUR, WHICH WAS THAT BEFORE THE
22
IPHONE, THE MAJORITY OF PHONES THAT EVERYBODY HAD THAT WE ALL
23
USED WERE WHAT WE CALLED FEATURE PHONES.
24
25
THEY'RE SIMPLER DEVICES THAT HAD A SCREEN WHERE YOU COULD

MAKE YOUR CALLS AND KEEP YOUR CONTACTS ON THEM.
IT HAD A SMALL
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KEYPAD FOR DIALLING ON IT.
AND THEN AFTER THE IPHONE, THERE WAS A DRAMATIC CHANGE IN
THE MARKETPLACE AND PHONES NOW COULD BECOME SMARTER AND BE
DRIVEN BY POWERFUL SOFTWARE THAT LETS YOU DO THINGS ON THE
INTERNET AND ACCESS ALL YOUR MEDIA AND ALL THESE THINGS THAT WE
DREAMT THE IPHONE COULD DO, IT REALLY DID CHANGE THE WORLD OF
PHONES.
Q.
SIR, HAS IT BEEN APPLE'S EXPERIENCE THAT WHEN A CUSTOMER
BUYS AN APPLE PRODUCT, THEY TEND TO BUY ADDITIONAL APPLE
10
PRODUCTS?
OR SERVICES?
11
A.
YES, IT IS.
12
Q.
AND CAN YOU DESCRIBE THAT FOR US?
13
A.
WELL, OFTEN WHEN A CUSTOMER PURCHASES A PRODUCT OF OURS,
14
AN IPHONE, AN IPAD OR ANOTHER DEVICE, THAT IF THEY HAVE A GREAT
15
EXPERIENCE WITH IT AND THEY REALLY LOVE IT, THEY'LL TEND TO BUY
16
OTHER THINGS WITH IT, THE ECOSYSTEM, ACCESSORIES AND OTHER
17
PRODUCTS THAT THEY MIGHT WANT TO USE WITH IT.
18
AND IF THEY CONTINUE TO HAVE A GREAT EXPERIENCE WITH IT,
19
THEY'RE LIKELY TO BUY MORE PRODUCTS FROM US DOWN THE ROAD, NOT
20
ONLY A SMARTPHONE, BUT MAYBE A COMPUTER.
21
FROM US.
22
THEY MIGHT BUY A MAC
WE ALSO OBSERVED A NETWORK EFFECT OF CUSTOMERS WHO BUY OUR
23
PRODUCTS.
IF THEY'VE HAD A GREAT TIME WITH IT, THEY'LL TELL
24
FAMILY AND FRIENDS AND THEY MAY START TO BUY IPHONES AND MACS
25
AND OTHER PRODUCTS.
OR IN THE WORK PLACE, IF THEY FIND I CAN
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USE THIS IPHONE AT WORK AND GET MY E-MAIL, OTHER PEOPLE MAY
LEARN THAT AND THEY ALL START TO HAVE THEM AS WELL.
3
4
5
SO THERE'S A LOT OF ECOSYSTEM EFFECTS ONCE SOMEONE STARTS

TO BUY AND USE OUR PRODUCT IF THEY LOVE THEM.
Q.
6
7
SIR, I WANT TO TURN BRIEFLY TO THE IPAD.

CAN YOU TELL US -- AGAIN, I REALLY DO WANT TO DO THIS
BRIEFLY -- WHAT WAS THE GENESIS OF THE IPAD PRODUCT?
A.
IN THE BEGINNING OF WORKING ON THE IPAD, WE WERE TRYING TO
INVENT A MORE AFFORDABLE COMPUTER.
OUR MOST POPULAR MACS WERE
10
NOTEBOOKS AND NOTEBOOK PRICING WAS GOING DOWN AND WE THOUGHT
11
EVENTUALLY NOTEBOOK PRICES WERE GOING TO DROP WELL BELOW $500.
12
BUT COMPETITORS WERE MAKING SOME REALLY CHEAP PRODUCTS
13
THAT WE WOULD NEVER BE PROUD TO MAKE.
14
WASN'T THERE.
15
HOW COULD WE MAKE A FUTURE MOBILE COMPUTER THAT HAD FEWER
16
MOVING PARTS, KEYBOARDS, THAT WOULD ALLOW US TO MAKE A NOTEBOOK
17
REPLACEMENT THAT WAS EVEN MORE AFFORDABLE.
18
THE QUALITY REALLY
SO WE CHALLENGED OUR TEAM TO HELP US FIGURE OUT
AND WE STARTED WORKING ON THAT AND WE HAD PROBABLY ONE OF
19
THE MOST IMPORTANT THINGS TO SOLVE WOULD BE TO GET RID OF THE
20
PHYSICAL KEYBOARD AND USE THE SCREEN TO TYPE DIRECTLY ON -- TO
21
GET RID OF THE MOUSE OR TRACK PAD AND USE THE SCREEN TO
22
MANIPULATE OBJECTS ON.
23
24
25
AND THAT'S WHAT LED US TO WORK ON MULTITOUCH TECHNOLOGY

THAT EVENTUALLY GAVE RISE TO BOTH THE IPAD AND IPHONE.
Q.
WHEN WAS THE IPAD ANNOUNCED?
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A.
IN JANUARY OF 2010.
Q.
SO THAT'S THREE YEARS AFTER THE IPHONE; CORRECT?
A.
YES, IT IS.
Q.
WHEN WAS THE IPAD RELEASED?
A.
IN APRIL OF 2010.
Q.
WHAT WAS, GENERALLY, THE RECEPTION FOR THE IPAD?
A.
THERE WAS TREMENDOUS EXCITEMENT AND INCREDIBLE MEDIA
COVERAGE AROUND THE IPAD.
Q.
WAS THE IPAD INVESTMENT PROJECT CONSIDERED A GAMBLE AT
10
APPLE?
11
A.
12
BECAUSE WE WERE ADDING NOW A FOURTH PRODUCT IN OUR BUSINESS,
13
MAC, IPOD, IPHONE, AND NOW IPAD, WE DIDN'T WANT TO DILUTE OUR
14
RESOURCES TOO MUCH BY TAKING ON YET ANOTHER THING.
15
WOULD RISK OTHER WORK.
16
YES.
IT WAS ALSO A "YOU BET YOUR COMPANY" PRODUCT, FIRST
SO THAT
AND UP UNTIL THAT POINT IN TIME, BEFORE IPAD, OTHER
17
COMPANIES HAD TRIED TABLET LIKE COMPUTERS AND NONE HAD DONE
18
WELL.
19
SO HERE WE ARE DOING BETTER WITH -- THE IPOD WAS DOING
20
REALLY WELL, AND NOW THE IPHONE IS DOING REALLY WELL, AND WE'RE
21
ABOUT TO TAKE ON SOMETHING RISKY THAT OTHERS HAD TRIED AND
22
FAILED AT AND WE RISKED THE REPUTATION OF APPLE IF WE WERE TO
23
FAIL AT THAT.
24
Q.
HOW WERE THE SALES OF THE IPAD PRODUCT?
25
A.
OH, THE EARLY SALES OF THE IPOD WERE EVEN STRONGER THAN
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IPHONE.
IT WAS GREAT.
Q.
ABOUT THE SALES OF THE IPAD?
A.
BOTTOM OF THE CHART, AND THAT TRACKS THE CUMULATIVE SALES OF
THE IPAD HERE IN THE U.S. FROM THE BEGINNING IN 2010 UP UNTIL
2013.
Q.
INVENTIONS IT MADE LEADING UP TO AND DURING THE DEVELOPMENT OF
LET'S GO BACK TO EXHIBIT 143.
WHAT DOES THIS TELL US
WELL, YOU CAN SEE ON THE SAME CHART THE ORANGE LINE ON THE
MR. SCHILLER, DID APPLE SEEK PATENT PROTECTION FOR THE
10
THE IPHONE AND THE IPAD?
11
A.
YES.
12
Q.
WHY?
13
A.
WELL, THERE ARE MANY REASONS TO WANT, TO GET PATENTS ON
14
OUR INVENTIONS.
15
FIRST, WE HAVE A LOT OF REALLY BRIGHT ENGINEERS WHO PUT IN
16
LONG HOURS AND PUT A LOT OF THEMSELVES PERSONALLY INTO CREATING
17
THESE THINGS, THESE IDEAS THEY DREAM UP AND THE INVENTIONS THAT
18
THEY COME UP WITH.
19
AND THOSE ARE THINGS THAT ARE CREATED FOR APPLE.
20
PRODUCT COMPANY, A TECHNOLOGY PRODUCT COMPANY.
21
PRODUCTS THAT ARE HOPEFULLY UNIQUE AND SPECIAL.
22
TRY TO DO.
23
WE'RE A
WE MAKE
THAT'S WHAT WE
AND THOSE INVENTIONS, IF THEY'RE UNIQUE AND SPECIAL, WE
24
WANT TO USE THEM IN OUR PRODUCTS FOR OURSELVES, TO
25
DIFFERENTIATE OURSELVES FROM THE REST OF THE MARKET.
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2
AND PATENTS HOPEFULLY HELP TO PROTECT US SO THAT WE CAN DO

THAT AND HAVE OUR UNIQUE ADVANTAGES.
THEY ALSO HELP IDENTIFY THOSE THINGS THAT WE'VE CREATED IN
OUR PRODUCTS THAT ARE UNIQUE TO APPLE THAT PEOPLE WILL
RECOGNIZE AND SEE AS APPLE INVENTING THEM, BEING THE CREATIVE
INVENTOR COMPANY WE LIKE TO BE SEEN AS.
I THINK IT'S REALLY IMPORTANT TO THE VERY DNA OF APPLE
THAT WE'RE AN INNOVATOR WHO CREATES UNIQUE DIFFERENTIATIONS IN
OUR PRODUCTS THAT CUSTOMERS VALUE.
10
Q.
11
YOUR EXPERIENCE AT APPLE, WHAT ARE YOUR VIEWS ABOUT SOME OF THE
12
REASONS WHY THE IPHONE HAS BEEN SO SUCCESSFUL.
13
14
SIR, BASED ON YOUR JOB RESPONSIBILITIES, WHAT YOU DO AND
MR. PRICE:
CALLS FOR EXPERT
TESTIMONY.
15
THE COURT:
16
OVERRULED.
GO AHEAD, PLEASE.
17
THE WITNESS:
IN MY JOB WORKING ON THE IPHONE, HAVING
18
A UNIQUE PRODUCT THAT SOLVES PROBLEMS FOR CUSTOMERS IN SPECIAL
19
WAYS AND MAKES THEM EASY AND FUN AND POWERFUL TO USE IS THE
20
VERY ESSENCE OF WHAT MAKES IT GREAT AND WHAT MAKES IT
21
SUCCESSFUL.
22
BY MR. MCELHINNY:
23
Q.
AND WHAT ARE THE REASONS FOR THE SUCCESS OF THE IPAD, SIR?
24
A.
IN THE SAME WAY.
25
PRODUCT BEFORE IT IN ITS CATEGORY, HAS SUCCEEDED BECAUSE IT'S
WE'VE CREATED A PRODUCT THAT, UNLIKE ANY
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BEAUTIFUL AND IT DOES THINGS YOU NEED IT TO DO AND IT DOES IT
IN FUN, INTUITIVE, EASY-TO-USE WAYS, AND THAT'S SO MUCH ABOUT
THE SOFTWARE AND ULTIMATELY THE ENTIRE USER EXPERIENCE WE
CREATED.
Q.
SIR, WOULD YOU OPEN YOUR BINDER, PLEASE, TO EXHIBIT 122A.
A.
OKAY.
Q.
WHAT IS EXHIBIT 122A?
A.
THIS IS A, A SUMMARY OF A QUESTION WE'VE ASKED CUSTOMERS
IN OUR MARKET RESEARCH SURVEYS, IN THIS CASE IPHONE BUYERS,
10
ABOUT THEIR EXPERIENCE WITH AN IPHONE.
11
Q.
12
AT BOTH PAGES 1 AND 2?
13
A.
14
QUARTER OF FISCAL 2012.
15
MR. MCELHINNY:
16
MR. PRICE:
17
18
AND WHAT TIME PERIOD DO THOSE SURVEYS COVER, SIR, LOOKING
FROM THE FIRST QUARTER OF FISCAL 2011 UP UNTIL THE FOURTH
YOUR HONOR, I MOVE EXHIBIT 122A.
YOUR HONOR, I OBJECT AS BEING
INAPPROPRIATE SUMMARIES.
SPECIFICALLY, AND I THINK WE HAVE AN AGREEMENT ON THIS, I
19
BELIEVE THERE WAS AN AGREEMENT NOT TO EVEN ATTEMPT TO ADMIT
20
PAGE 3.
21
22
23
24
25
THE COURT:
I'M SORRY.
I COULDN'T HEAR THE LAST
THING YOU SAID.

MR. PRICE:
I BELIEVE THERE WAS AN AGREEMENT NOT TO
ADMIT PAGE 3.
(DISCUSSION OFF THE RECORD BETWEEN COUNSEL.)
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MR. PRICE:
HOLD ON ONE SECOND, YOUR HONOR.
LET ME
LOOK AT THE NEW EXHIBIT.
(DISCUSSION OFF THE RECORD BETWEEN COUNSEL.)
MR. PRICE:
YOUR HONOR, I NOW HAVE A CORRECT COPY.
THE ONLY OBJECTION IS THAT IT'S AN INAPPROPRIATE SUMMARY.
NOT -- IT'S NOT A COMPLICATED DOCUMENT OR VOLUMINOUS DOCUMENTS.
7
8
THE COURT:
OBJECTION?
ALL RIGHT.
IT'S
SO YOU'RE MAKING A 1006
THAT'S OVERRULED.
GO AHEAD, PLEASE.
10
BY MR. MCELHINNY:
11
Q.
12
CAN WE PUT THIS UP ON THE SCREEN, PLEASE, FIRST PAGE.

MR. SCHILLER, WHAT IS AN IPHONE BUYER SURVEY?
13
A.
MY MARKET RESEARCH TEAM --
14
Q.
LET ME STOP YOU RIGHT THERE.
15
TEAM?
16
A.
17
LOOK BOTH AT PRIMARY RESEARCH, QUESTIONS WE CAN ASK OF
18
CUSTOMERS AND PULL TOGETHER RESULTS, AS WELL AS SECONDARY
19
RESEARCH, THAT'S RESEARCH THAT OTHER PEOPLE DO THAT WE CAN
20
PURCHASE AND LOOK AT AND SEE WHAT THEY'VE LEARNED OR FOUND OUT.
21
WHAT IS A MARKET RESEARCH
IT'S A SMALL GROUP OF PEOPLE WHO WORK FOR ME WHO HELP US
AND MY TEAM IS RESPONSIBLE FOR THOSE TWO THINGS.
22
Q.
ALL RIGHT.
I APOLOGIZE FOR INTERRUPTING YOU.
BACK TO
23
WHAT IS AN IPHONE BUYER SURVEY?
24
A.
25
QUESTIONS OF RECENT IPHONE BUYERS TO FIND OUT SOME OF THE
SO THIS IS A SURVEY THAT WE RUN EACH QUARTER THAT ASKS
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THINGS THEY THINK ABOUT IPHONE.
Q.
SURVEYS?
A.
MY TEAM DOES.
Q.
AND ARE THE SURVEYS THEMSELVES THAT ARE -- THAT THIS
DOCUMENT SUMMARIZES, ARE THEY CONSIDERED CONFIDENTIAL DOCUMENTS
AT APPLE?
A.
YES, THEY ARE.
Q.
AND WHY IS THAT?
10
A.
BECAUSE ANY COMPANY, AND THIS IS CERTAINLY TRUE IN OUR
11
CASE, HAS A UNIQUE ABILITY TO SPEAK TO YOUR OWN CUSTOMER.
12
COMPETITORS DON'T KNOW OUR CUSTOMERS WELL, BUT WE HAVE AN
13
ABILITY TO SPEAK TO THEM AND ASK THEM QUESTIONS AND THEN GATHER
14
THIS DATA AND GAIN INSIGHTS AS TO WHAT THEY MAY THINK, AND WE
15
CONSIDER THAT CONFIDENTIAL.
16
Q.
17
SUMMARY, ON PAGE 1 OF THE SUMMARY THAT WE'VE GOT HERE?
18
A.
19
ACROSS MANY SURVEYS OVER PERIODS OF TIME WE LISTED.
20
21
AND WHO DETERMINES WHAT QUESTIONS GET ASKED ON THESE
OUR
SIR, CAN YOU EXPLAIN TO US WHAT WE'RE SEEING ON THIS
YES.
THIS IS A SUMMARY OF ONE QUESTION THAT WAS ASKED
THE SIMPLE QUESTION WAS HOW IMPORTANT WAS EASE OF USE TO

YOUR DECISION TO PURCHASE YOUR IPHONE?
22
AND THESE ARE THE RESPONSES TO THAT QUESTION, AND
23
SPECIFICALLY THE WAY WE LOOK AT THE RESPONSE IS CUSTOMERS ARE
24
ASKED TO RANK THEIR BELIEF ON WHETHER THIS WAS IMPORTANT TO
25
EASE OF USE ON A SCALE OF 1 TO 5.
THE TOP TWO THINGS ARE
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WHETHER IT WAS SOMEWHAT IMPORTANT OR VERY IMPORTANT.
AND IN MARKETING WHAT WE DO IS WE COMBINE THOSE TWO TOP
SCORES TO CREATE ONE TOTAL SCORE, AND THAT'S A MEASURE OF HOW
IMPORTANT IT IS THAT YOU COMPARE AMONGST DIFFERENT QUESTIONS
AND DIFFERENT SURVEYS.
Q.
SIR, WHY DO YOU USE THE PHRASE "EASE OF USE" IN YOUR
SURVEYS?
A.
APPLE HAS DONE FOR CUSTOMERS OF OUR PRODUCTS OVER THE YEARS.
I THINK EASE OF USE IS ONE OF THE MOST IMPORTANT THINGS
10
IT'S ONE OF THE MOST IMPORTANT THINGS WE TRY TO DELIVER IN OUR
11
PRODUCTS, AND I THINK IT'S SOMETHING APPLE IS KNOWN FOR.
12
IT'S INCREDIBLY IMPORTANT.
13
Q.
14
THAT MAKES THE SMARTPHONE EASY TO USE, WHY YOU GET THESE KINDS
15
OF CUSTOMER RANKINGS?
16
A.
17
USE.
18
IT'S AN ACCUMULATION OF ALL THE THINGS THAT MAKE UP YOUR
19
EXPERIENCE WITH THAT PRODUCT.
20
THOSE THINGS ARE SOFTWARE, ALL THE GREAT SOFTWARE FEATURES THAT
21
MAKE IT SO YOU UNDERSTAND HOW YOU CAN GET WHAT YOU WANT DONE
22
AND YOU ENJOY DOING THAT.
23
EXPERIENCE OF EASE OF USE.
24
Q.
25
PREPARED, CAN YOU EXPLAIN TO US WHAT WE'RE SEEING THERE,
SO
AND WHAT IS IT, BASED ON YOUR UNDERSTANDING OF WHAT IT IS
WELL, THERE ISN'T ONE SPECIFIC FEATURE THAT SAYS EASE OF

THIS ISN'T A SWITCH ON THE SCREEN THAT SAYS EASY OR HARD.
AND THE PREDOMINANT RANGE OF
I THINK THAT ADDS UP TO YOUR
IF YOU WOULD LOOK AT PAGE 2 OF THE SUMMARY THAT YOU
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PLEASE.
A.
EASE OF USE WHERE WE HAD SUCH A HIGH RESPONSE RATE OVER TIME
AND INSTEAD LOOKS AT IT BY INDIVIDUAL IPHONE MODEL.
ALL THAT TIME, YOU KNOW, WHAT DO CUSTOMERS THINK ABOUT EASE OF
USE FROM IPHONE 4, IPHONE 4S, IPHONE 5 TO SEE IF THERE'S ANY
DIFFERENT BY PRODUCT.
8
9
SO THIS LOOKS AT THAT SAME DATA OF ASKING CUSTOMERS ABOUT
SO ACROSS
AND WHAT IT SHOWS IS THERE REALLY ISN'T ANY DIFFERENCE BY

PRODUCT.
10
SO OVER TIME, OVER DIFFERENT PRODUCTS, THEY CONSISTENTLY
11
TELL US THAT WELL OVER 90 PERCENT ON AVERAGE THINK EASE OF USE
12
IS EXTREMELY IMPORTANT TO THEIR PURCHASE CHOICE OF AN IPHONE.
13
Q.
SIR, IN YOUR BINDER, WOULD YOU PLEASE TURN TO EXHIBIT 123.
14
A.
OKAY.
15
Q.
AND CAN YOU TELL ME WHAT THAT DOCUMENT IS?
16
A.
SO THIS IS A SURVEY THAT WAS DONE OF SMARTPHONE BUYERS
17
FROM DIFFERENT VENDORS THAT ALSO WAS ASKING THE QUESTION OF
18
EASE OF USE.
19
20
MR. MCELHINNY:
SHOULD SOMEBODY OFFER THE JUROR SOME WATER, PLEASE.
21
JUROR:
22
THE COURT:
23
JUROR:
24
THE COURT:
25
YOUR HONOR, MAY I OFFER THE JUROR, OR
THAT WOULD BE GOOD.

OH, YES.
I'M SORRY.
THAT WOULD BE GOOD.
GOING TO TAKE A BREAK AT 3:30.
IT'S 3:29.
YOU KNOW, WE WERE

IF YOU WOULD LIKE
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TO TAKE ONE NOW, WE CAN DO THAT.
JUROR:
THE COURT:
THAT WOULD BE GREAT.

OKAY.
AND YOU MAY STEP DOWN.
9
10
LET'S TAKE A 15 MINUTE
BREAK.
IT'S 3:29.
THE COURT:
OKAY.
THE RECORD SHOULD REFLECT THE

PLEASE TAKE A SEAT.
I'M LOOKING AT THE MOTIONS IN LIMINE THAT SAMSUNG FILED.
11
I DON'T SEE ANY THAT WOULD ADDRESS CUMULATIVE UNIT SALES OF
12
IPHONE AND IPAD.
13
WHAT IT IS THAT YOU'RE PRESERVING SINCE THERE WAS NO INDIVIDUAL
14
OBJECTIONS FILED TO THIS PX 143, THE OBJECTIONS WERE TO 122,
15
179, AND 211.
16
17
SO I JUST WANT TO HAVE AN UNDERSTANDING OF
SO WHAT IS IT EXACTLY THAT'S BEING PRESERVED HERE, JUST SO

I UNDERSTAND?
18
MR. PRICE:
YOUR HONOR, I'VE BEEN TOLD YOU'RE RIGHT,
19
WE DID NOT MAKE MOTIONS IN LIMINE ON THOSE, THOSE SPECIFIC
20
EXHIBITS.
21
THE COURT:
OKAY.
22
MR. PRICE:
SO MY ONLY OBJECTION WAS TO 1006, WHICH
THE COURT:
WHICH WAS NOT TO THIS ONE.
23
24
25
YOU -WERE YOU
MAKING -- I DIDN'T HEAR YOU MAKING A 1006 OBJECTION TO THIS
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ONE.
YOU SAID YOU WERE PRESERVING YOUR MOTION IN LIMINE
OBJECTION, WHICH THERE IS NONE.
3
4
MR. PRICE:
AND I'VE BEEN TOLD THAT, AS IS USUALLY
THE CASE, YOU'RE RIGHT.
5
6
SO --
THE COURT:
PRESERVING.
I JUST WANT TO UNDERSTAND WHAT YOU'RE
I KNOW EVERYONE WANTS TO MAKE A GOOD RECORD.
MR. PRICE:
I KNOW THE MAIN THING --
THE COURT:
AND I ALSO WANT TO MAKE A GOOD RECORD,
TOO.
SO IF YOU'RE MAKING AN OBJECTION, I WANT TO KNOW WHAT IT
10
IS SO THAT I CAN MAKE AN APPROPRIATE RULING.
11
ASKING.
12
13
14
15
16
MR. PRICE:
THAT'S WHY I'M
I UNDERSTAND WHY YOU'RE ASKING.
WE'VE
MADE A LOT OF OBJECTIONS ABOUT NEWSPAPER ARTICLES, ET CETERA.

THE COURT:
SURE, I TOTALLY UNDERSTAND.
THAT WAS
MOTION IN LIMINE NUMBER -(PAUSE IN PROCEEDINGS.)
17
THE CLERK:
THERE'S A REQUEST FOR SOME LOZENGES.
18
THE COURT:
OH, OKAY.
19
20
(LAUGHTER.)
MS. KREVANS:
22
MR. MCELHINNY:
24
25
OH, LET SAMSUNG
INSPECT THOSE.
21
23
I HAVE SOME.
THEY'RE MINE, YOUR HONOR.

WOULD YOU PLEASE TELL THE JURY THAT
SAMSUNG DIDN'T WANT THEM TO HAVE THESE.

THE COURT:
AND WE CAN GET SOME MORE.
AND I'M GOING
TO BRING UP THE EMERGENCY AND AIRBORNE AND EVERYTHING ELSE.
WE
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CANNOT -OKAY.
I UNDERSTAND.
ALL RIGHT.
SO FOR 143, I'M
UNDERSTANDING THERE WAS NOT A 1006 OBJECTION.
WOULD OVERRULE IT BECAUSE OTHERWISE TRYING TO INTRODUCE SINGLE
SALES NUMBERS FOR EVERY QUARTER FOR A PERIOD OF SEVEN YEARS I
THINK WOULD -- IT WOULD BE HELPFUL TO A JURY TO HAVE A
CUMULATIVE PRESENTATION, A SUMMARY PRESENTATION OF THAT TYPE OF
CUMULATIVE AND LENGTHY EVIDENCE.
9
10
BUT I UNDERSTAND THERE'S NO MOTION IN LIMINE OBJECTION AS

TO 143.
11
MR. PRICE:
YOU'RE CORRECT.
12
THE COURT:
GOT IT.
13
MR. MCELHINNY:
THE COURT:
17
MR. MCELHINNY:
18
THE COURT:
22
23
24
25
LET'S
WHAT TIME DO YOU WANT US BACK, YOUR
TEN MINUTES.
TEN MINUTES.
YEAH.
THANK YOU.
THANK YOU.
20
21
THANK YOU.
HONOR?
16
19
ALL RIGHT.
TAKE OUR BREAK.
14
15
IF THERE WAS, I
THE COURT:
ALL RIGHT.
LET'S PLEASE BRING IN OUR
JURY.
THE COURT:
ALL RIGHT.
WELCOME BACK.
DO WE HAVE EIGHT?
THE CLERK:
WE ARE --
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THE COURT:
PERSON.
I JUST DIDN'T SEE THE EIGHTH
THAT'S WHY.
(LAUGHTER.)
4
5
OKAY.
THE COURT:
ALL RIGHT.
AND WOULD EVERYONE PLEASE
TAKE A SEAT.
TIME IS NOW 3:44.
GO AHEAD, PLEASE.
BY MR. MCELHINNY:
Q.
MR. SCHILLER, WOULD YOU LOOK, PLEASE, IN YOUR BINDER AT
10
A.
YES.
11
Q.
WHAT IS EXHIBIT 123, SIR?
12
A.
THIS IS A SUMMARY OF A SMARTPHONE MARKET BUYER STUDY.
13
Q.
FOR WHAT TIME PERIOD DOES IT COVER?
14
A.
FROM THE FOURTH QUARTER OF FISCAL 2011 UNTIL THE FOURTH
15
QUARTER OF FISCAL 2012.
16
MR. MCELHINNY:
17
YOUR HONOR, I MOVE THE SUMMARY,
PX 123.
18
MR. PRICE:
NO OBJECTION.
19
THE COURT:
ALL RIGHT.
20
IT'S ADMITTED.
21
THE COURT:
22
BY MR. MCELHINNY:
23
Q.
24
IN THE SUMMARY?
25
A.
GO AHEAD, PLEASE.
MR. SCHILLER, CAN YOU TELL US WHAT WE'RE LOOKING AT HERE
YES.
THIS IS ALSO A QUESTION THAT WAS ASKED OF CUSTOMERS
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OF BOTH IPHONES, AS WELL AS ANDROID PHONES, HOW IMPORTANT OR
UNIMPORTANT WAS EASE OF USE TO THEIR DECISION TO PURCHASE A
PHONE?
AND YOU CAN SEE IN BLUE COLOR THERE ARE THE BARS FOR THE
IPHONE OR IOS USERS, AND IN GREEN, THE ANDROID PHONE USERS AND
WHAT THEY FELT ABOUT THE IMPORTANCE OF EASE OF USE.
Q.
AND, AGAIN, SO WE'RE CLEAR, WHAT'S THE DIFFERENCE BETWEEN
THE SURVEYS THAT WENT INTO THIS SUMMARY AND THE SURVEYS OF THE
PRIOR SUMMARY THAT YOU WERE TALKING ABOUT?
10
A.
11
OWN CUSTOMERS.
12
WELL, THE PRIOR SUMMARY, WE HAD ACCESS TO SURVEYING OUR
WHEN IT COMES TO A SURVEY WHERE YOU'RE SURVEYING CUSTOMERS
13
OF OTHER PRODUCTS, YOU HAVE TO TURN TO OTHER MEANS THAT ARE
14
USEFUL, BUT NOT QUITE AS GOOD YOUR OWN.
15
IN THIS CASE YOU WORK WITH AN OUTSIDE COMPANY THAT HAD
16
ACCESS TO THE INTERNET COMMUNITY, PEOPLE THAT THEY OFTEN ASK
17
QUESTIONS OF.
18
19
SO IT'S AN INTERESTING RESULT.
IT'S GOOD, BUT NOT AS
GOOD.
20
Q.
LET'S LOOK AT PAGE 2 OF THIS SURVEY, AND WHAT DOES THIS
21
TELL US, OF THE SUMMARIES OF THE SURVEYS.
22
US?
23
A.
24
BUYERS WERE TO PURCHASE AN IPHONE IN THE FUTURE TO FOLLOW ON
25
THEIR PURCHASE WITH ANOTHER IPHONE.
WHAT DOES THIS TELL
SO THIS PAGE IS ABOUT THE QUESTION ABOUT HOW LIKELY THESE
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AND, AGAIN, IT'S A TOP TWO BOX METRIC USE.
SO PEOPLE WHO
SELECTED EITHER SOMEWHAT LIKELY OR VERY LIKELY AS THEIR
RESPONSE TOTALLED UP, AND AS YOU SEE, THAT IS A VERY, VERY
STRONG RESPONSE TO GET WELL OVER 90 PERCENT OF CUSTOMERS ON
AVERAGE TO SAY THAT THEY'RE LIKELY TO PURCHASE AN IPHONE AGAIN.
Q.
WOULD YOU SHOW US PAGE 3 OF THE SUMMARY, PLEASE.

AND WHAT DOES THIS TELL US?
A.
THIS IS A QUESTION THAT WAS ASKED OF THE PEOPLE IN THE
SURVEY ABOUT WHETHER THEY ARE -- THIS DEVICE THEY CURRENTLY OWN
10
IS THEIR FIRST SMARTPHONE WHETHER THEY'RE A FIRST-TIME
11
SMARTPHONE BUYER, AND AS YOU SEE ACROSS THE BARS, THE NUMBER
12
WAS VERY HIGH FOR FIRST-TIME BUYERS, ANYWHERE FROM JUST UNDER
13
50 PERCENT TO AS HIGH AS 60 PERCENT OF PEOPLE WHO HAD BOUGHT A
14
SMARTPHONE DURING THE TIME OF THE SURVEY WHO HAD NEVER HAD ONE
15
BEFORE.
16
Q.
17
IS THE TIME PERIOD THAT THE SURVEY IS SHOWING US THIS HIGH
18
FIRST-TIME BUYERS PHENOMENA?
19
A.
20
2011 AND GO INTO THE FOURTH QUARTER OF FISCAL 2012.
21
Q.
WHAT IS THE FOURTH QUARTER OF APPLE'S FISCAL 2012?
22
A.
THAT IS THE JULY/AUGUST/SEPTEMBER QUARTER IS HOW WE COUNT
23
FISCAL QUARTERS.
24
Q.
IN WHAT CALENDAR YEAR WOULD THAT BE?
25
A.
THAT WOULD BE 2012.
AND, AGAIN, I THINK THE YEARS MAY BE IMPORTANT HERE.
WHAT
THIS SURVEY PERIOD STARTED AT FOURTH QUARTER OF FISCAL
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Q.
AS THE HEAD OF MARKETING?
A.
WHAT WE'VE BEEN SAYING FROM DAY ONE WHEN WE STARTED WORK ON THE
IPHONE IS THAT ONE DAY WE BELIEVE MOST EVERYONE WOULD HAVE A
SMARTPHONE, AND WHERE WE ARE THROUGHOUT THIS PERIOD OF TIME IS
STILL IN A TIME WHERE MANY, MANY PEOPLE DON'T HAVE A
SMARTPHONE.
LIKELY TO HAVE A FEATURE PHONE, PREVIOUS GENERATION OLDER
10
THANK YOU.
WHAT IS THE SIGNIFICANCE OF THIS NUMBER TO YOU
OH, IT'S INCREDIBLY IMPORTANT.
IT SHOWS, FIRST OF ALL,
THEY MAY NOT HAVE A CELL PHONE AT ALL OR THEY'RE
TECHNOLOGY, AND ARE NOW GETTING A SMARTPHONE.
11
AND AT LEAST DURING THE PERIOD OF ALL OF THIS RESEARCH YOU
12
SEE THAT STILL A VERY LARGE NUMBER OF PEOPLE ARE GETTING THEIR
13
FIRST PHONE, AND THAT FIRST PHONE, AS WE TALKED ABOUT EARLIER,
14
IS THE PHONE PURCHASE THAT WILL THEN HELP YOU DECIDE WHAT
15
FOLLOW-ON PRODUCTS YOU MIGHT GET.
16
YOU'RE MORE LIKELY TO STAY WITH IT FOR A LOT LONGER.
IF YOU LIKE THAT PRODUCT,
17
Q.
SIR, HAS APPLE MADE EFFORTS TO PROMOTE ITS PRODUCTS?
18
A.
YES, IT HAS.
19
Q.
AND WHAT KIND OF THINGS DO YOU DO TO PROMOTE YOUR
20
PRODUCTS?
21
A.
22
LARGE KEYNOTES AND EVENTS.
23
PRODUCTS; WE DO ADVERTISING; WE DO OUTDOOR MARKETING; WE SET UP
24
DISPLAYS IN OUR RETAIL STORE AND WE TRAIN PEOPLE.
25
WELL, IN MARKETING WE HAVE MANY ACTIVITIES.
WE PUT ON
WE DO PRESS REVIEWS OF OUR
MANY, MANY THINGS.
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Q.
IS ADVERTISING IMPORTANT TO WHAT YOU DO?
A.
IT IS.
Q.
SIR, IS IT, IN YOUR OPINION, IS IT ADVERTISING THAT DRIVES
THE SALES OF THE APPLE PRODUCTS?
A.
NOT AT ALL.
Q.
HELP ME WITH THAT.
ADVERTISING AND IT'S IMPORTANT, WHY DO YOU SAY IT DOESN'T DRIVE
THE SALES OF YOUR PRODUCTS?
A.
IT'S ONE OF THE MARKETING FUNCTIONS THAT I RUN.
IF YOU SPEND AS MUCH TIME AS YOU DO ON
IN MY BELIEF IS THAT APPLE -- THE THING THAT'S MOST
10
IMPORTANT TO THE MARKETING IS NOT THE MARKETING.
11
PRODUCT.
12
IT'S THE
AT THE END OF THE DAY, YOU CAN HAVE A HORRIBLE PRODUCT AND
13
A GREAT AD.
14
SO GOOD.
IT MIGHT NOT SELL WELL BECAUSE THE PRODUCT'S NOT
15
OR YOU COULD HAVE A GREAT PRODUCT AND A HORRIBLE AD AND
16
THE PRODUCT STILL MIGHT DO WELL BECAUSE IT'S A GREAT PRODUCT.
17
SO ADVERTISING IS A TOOL THAT'S USEFUL IN MARKETING, BUT
18
THE CORRELATION BETWEEN THE AD AND A SALE I'VE NEVER FOUND AT
19
APPLE TO BE VERY STRONG.
20
Q.
IS THE VIEW THAT YOU'VE JUST EXPRESSED REFLECTED IN THE
21
WAY THAT APPLE DOES ITS ADVERTISING?
22
A.
I BELIEVE SO.
23
Q.
AND HOW IS THAT?
24
A.
WELL, WE'VE HAD A STRATEGY FOR QUITE A WHILE IN OUR
25
MARKETING THAT WE CALL "THE PRODUCT AS HERO."
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Q.
EXPLAIN THAT FOR US, PLEASE.
A.
IT'S A SIMPLE THOUGHT, BUT A -- IT HAS A HUGE IMPACT
ACROSS OUR MARKETING, THAT IF THE MOST IMPORTANT THING TO THE
CUSTOMER WANTING TO PURCHASE A PRODUCT IS THE PRODUCT ITSELF,
THEN THE MARKETING SHOULD DO A GOOD JOB OF FOCUSSING FIRST AND
FOREMOST ON THE PRODUCT.
IT'S WHAT YOU SEE IN THE AD.
IT'S WHAT YOU SEE ON THE
BILLBOARD.
THE PRODUCT IS THE MOST IMPORTANT THING, YOU FOCUS MOST ON THAT
10
PRODUCT.
11
Q.
12
13
IT'S WHAT YOU SEE WHEN YOU WALK INTO THE STORE.
I WANT TO SWITCH SUBJECTS AGAIN.

IS SAMSUNG ONE OF APPLE'S COMPETITORS IN THE SMARTPHONE
MARKET?
14
A.
YES.
15
Q.
LET ME SHOW YOU PDX 7, SIR, WHICH IS A LIST OF ACCUSED
16
PRODUCTS IN THIS CASE.
17
18
DURING THE TIME THEY WERE ON THE MARKETPLACE, DID THOSE

PRODUCTS COMPETE WITH APPLE'S SMARTPHONES AND TABLETS?
19
A.
YES, THEY DID.
20
Q.
SIR, DID APPLE OFFER ITS PRODUCTS TO ONLY CERTAIN SEGMENTS
21
OF THE SMARTPHONE AND TABLET MARKET?
22
A.
23
SEGMENTATION.
24
Q.
25
QUESTION BETTER.
NOT AT ALL.
IN THE WORLD OF MARKETING, THAT'S CALLED
CAN I INTERRUPT YOU?
TELL US -- I SHOULD HAVE ASKED THE
TELL US, PLEASE, WHAT SEGMENTATION IS IN THE
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WORLD OF MARKETING?
A.
OF THE POPULATION, SOME PEOPLE CONSIDER SEGMENTS BY
DEMOGRAPHICS, LIKE AGE GROUP OR INCOME.
IT'S A SIMPLE THOUGHT, THAT THERE ARE DIFFERENT SEGMENTS
OTHER PEOPLE LOOK AT SEGMENTATION BY WHAT KIND OF JOB YOU
MAY HAVE, WHETHER YOU'RE IN EDUCATION OR BUSINESS AND THE KIND
OF BUSINESS.
8
9
AT APPLE, THAT'S NEVER BEEN THE WAY WE WORK ON OUR

PRODUCTS.
10
THAT'S NEVER BEEN THE WAY WE MARKET OUR PRODUCTS.
WE HAVE A VERY SIMPLE PRINCIPLE.
11
PRODUCTS FOR EVERYONE.
12
THINGS REALLY SIMPLE.
13
14
WE TRY TO MAKE OUR
IF YOU DO THAT, IT ACTUALLY KEEPS
THE IPHONE, WHO DO WE MARKET AND DESIGN THE IPHONE FOR,

FOR EVERYONE.
15
WE DESIGN THE IPAD FOR EVERYONE.
16
Q.
17
SOMETHING, AND I'M NOT SURE WE ALL WOULD HAVE UNDERSTOOD WHAT
18
IT WAS.
19
SAMSUNG'S COUNSEL, IN HIS OPENING ARGUMENT, REFERRED TO
HE MENTIONED SOMETHING ABOUT CARRIER SUBSIDIES.
20
A.
YES.
21
Q.
CAN YOU TELL US WHAT CARRIER SUBSIDIES ARE AS THEY AFFECT
22
PRICING IN THE CELL PHONE MARKET?
23
A.
24
PURCHASE A PHONE, IT ALMOST ALWAYS COMES WITH A CONTRACT TIME
25
LENGTH.
WHEN MANY CUSTOMERS HERE IN THE UNITED STATES GO TO
YOU CAN PURCHASE A PHONE, AND THEY MAY HAVE A TWO-YEAR
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CONTRACT WITH THAT.
THAT CARRIER FOR THAT PERIOD OF TIME.
AND THAT MEANS YOU'RE GOING TO STAY WITH
AND IN EXCHANGE FOR THAT, WHAT THE CARRIER GIVES YOU IS A
LOWER PRICE ON THE PHONE, AND THAT LOWERING OF THE PRICE,
THAT'S WHAT'S CALLED A SUBSIDY.
Q.
AND WHAT IS, TODAY, THE LOWEST PRICE AT WHICH AN IPHONE IS
AVAILABLE TO A CONSUMER WHO WANTS TO GET ONE?
A.
FOR FREE.
Q.
HOW CAN THAT BE?
10
A.
AGAIN, WHAT HAPPENS IS THAT OUR IPHONES ARE OFFERED BY
11
CARRIERS IN THE UNITED STATES, YOU KNOW, CARRIERS LIKE AT&T AND
12
VERIZON AND SPRINT, AND THEY OFFER THEM AND IF YOU PURCHASE IT
13
WITH A CONTRACT TO STAY WITH THAT CARRIER, THAT THERE ARE
14
MODELS OF IPHONE THAT WILL START FOR ZERO DOLLARS DOWN.
15
JUST GET THE IPHONE.
16
Q.
17
RETAIL CHANNELS?
18
A.
YES, WE DO.
19
Q.
AND CAN YOU GIVE US SOME EXAMPLES OF WHERE YOU COMPETE
20
HEAD-TO-HEAD WITH SAMSUNG?
21
A.
22
CHANNELS.
23
OTHERS, OR IN LARGE RESELLERS, LIKE BEST BUY WOULD BE AN
24
EXAMPLE OF THOSE AND THROUGH ONLINE CHANNELS AND ON AND ON.
25
Q.
YOU
DO APPLE AND SAMSUNG COMPETE HEAD-TO-HEAD IN PARTICULAR
WE BOTH OFFER PRODUCTS FOR SALE IN A WIDE VARIETY OF

FOR EXAMPLE, CARRIER STORES, AGAIN, LIKE AT&T AND
SIR, CAN YOU TELL ME WHAT YOUR PERSONAL REACTION WAS WHEN
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SAMSUNG'S GALAXY PHONES FIRST CAME ON TO THE MARKETPLACE?
2
3
MR. PRICE:
MR. MCELHINNY:
IT'S
THIS IS FOUNDATIONAL TO THE EFFECTS
OF COMPETITION, YOUR HONOR.
THE COURT:
OVERRULED.
GO AHEAD, PLEASE.
8
9
I'M GOING TO OBJECT.
NOT RELEVANT WITH RESPECT TO THESE PATENTS IN THIS CASE.
4
5
OBJECTION.
THE WITNESS:
I DO REMEMBER WHEN I FIRST SAW A
SAMSUNG GALAXY PHONE BEING LAUNCHED.
I READ ABOUT IT IN AN
10
ONLINE NEWS STORY AND THE FIRST REACTION WAS SHOCK THAT IT
11
APPEARED THAT THEY, THAT SAMSUNG, WAS GOING TO BE DOING A LOT
12
OF COPYING OF OUR PRODUCT.
13
TO COPY THE IPHONE.
14
BY MR. MCELHINNY:
15
Q.
16
IN MARKETING?
17
A.
18
19
20
21
IT LOOKED SO MUCH LIKE AN ATTEMPT
SIR, DOES COPYING, AS SUCH, CAUSE APPLE PRODUCTS PROBLEMS
IT CAUSES A LOT OF PROBLEMS, MUCH.

MR. PRICE:
I OBJECT UNLESS IT'S COMING TO DAMAGES,
INFLUENCE FROM THESE PATENTS, CLAIMS IN THIS CASE.

MR. MCELHINNY:
THE DAMAGE CAUSED BY COPYING IS
GENERIC, YOUR HONOR.
22
THE COURT:
OVERRULED.
23
THE WITNESS:
GO AHEAD.
YOU MAY ANSWER.
WELL, WE SPOKE EARLIER ABOUT HOW IN OUR
24
MARKETING IT'S DOMINATED BY THE PRODUCT AS THE HERO.
25
TRYING TO SHOWCASE WHAT OUR PRODUCT IS, WHAT IT DOES, WHY IT'S
WE'RE
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SO SPECIAL, WHY IT'S INNOVATIVE.
AND WHEN SOMEONE ELSE COPIES THINGS ABOUT THAT PRODUCT,
INNOVATIONS WE'VE CREATED, IT DIMINISHES THE VALUE THAT WE'RE
BRINGING TO CUSTOMERS.
CAPABILITIES THAT WERE UNIQUE TO US.
AS EASY TO MARKET.
IT, FIRST OF ALL, TAKES AWAY

SO THAT UNIQUENESS ISN'T
SECONDLY, IT CONFUSES CUSTOMERS ABOUT THE SOURCE OF THOSE
THINGS, WHETHER APPLE IS BEING INNOVATOR AND DOING THESE THINGS
OR WHETHER SAMSUNG OR SOMEONE ELSE IS INNOVATING, AND THAT
10
CONFUSES CUSTOMERS AND TO THE EXTENT THAT THIS HAPPENS A LOT
11
AND IT'S HAPPENING ON A VERY LARGE SCALE, MORE AND MORE IT
12
DIMINISHES WHETHER PEOPLE EVEN SEE APPLE AS THE INNOVATOR WE
13
ARE IN THE THINGS WE'RE CREATING.
14
AND AS THE MARKETER WHO HAS TO HELP CUSTOMERS UNDERSTAND
15
THE INNOVATIONS AND THE EASE OF USE AND THE GREAT EXPERIENCE OF
16
THE PHONE THAT WE CREATE, IT GETS HARDER AND MORE CHALLENGING
17
IF OTHERS ARE COPYING THOSE THINGS AND YOU CAN'T STAND ON THEM
18
AS YOUR OWN INNOVATIONS.
19
Q.
SIR, ARE YOU GENERALLY FAMILIAR WITH THE FIVE PATENTS THAT
20
ARE BEING SPECIFICALLY ASSERTED IN THIS CASE?
21
A.
GENERALLY I AM, YES.
22
Q.
JUST SO WE UNDERSTAND, AT WHAT LEVEL DO YOU UNDERSTAND
23
THEM?
24
A.
I KNOW THAT THERE ARE FIVE.
I KNOW ROUGHLY WHAT THEY ARE
25
AND CERTAINLY I'M AWARE OF THEM.
AND NOT TO PROGRAMMING LEVEL
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DETAIL, I'M NOT A PROGRAMMER, BUT I DO KNOW ABOUT THEM.
Q.
GENERALLY FAMILIAR WITH APPLE'S WILLINGNESS TO LICENSE ITS
INTELLECTUAL PROPERTY TO OTHER COMPANIES?
THAT ONE.
A.
YES.
Q.
OKAY.
TO AUGUST 2011.
A.
I WILL TRY.
10
Q.
CAN YOU HELP ME OUT?
11
GETTING THERE, ARE SOME GUIDEPOSTS OF EVENTS THAT HAPPENED AT
12
APPLE DURING THAT PERIOD THAT YOU WOULD BE FAMILIAR WITH?
13
A.
14
THINK ABOUT WAS WHAT WE WERE WORKING ON AND DOING.
15
SUMMER WE HAD INTRODUCED, NOT YET SHIPPED, THE LATEST VERSION
16
OF OUR OPERATING SYSTEM, IOS 5 AT THAT TIME, SOFTWARE THAT
17
WOULD RUN ON IPHONES AND IPADS.
18
OKAY.
ARE YOU, AS A MEMBER OF THE EXECUTIVE TEAM, ARE YOU
JUST A YES OR NO TO
I WOULD LIKE YOU TO TAKE YOURSELF BACK, IF YOU CAN,

CAN YOU DO THAT FOR ME?
SO THAT WE UNDERSTAND HOW YOU'RE
WELL, AS I THINK OF THE SUMMER OF 2011, THE FIRST THING I

SO IN THAT
SO WE HAD LAUNCHED IOS 5 AND HAD A NUMBER OF NEW
19
CAPABILITIES.
WE INTRODUCED ICLOUD WITH THAT, ONE OF OUR
20
INTERNET SERVICES BUILT INTO THE OPERATING SYSTEM.
21
WE INTRODUCED IMESSAGE, COMMUNICATIONS IN IOS, AND
22
WIRELESS SYNCING WAS ONE OF THE BIG FEATURES THAT WAS PART OF
23
THAT.
24
25
WE WERE ALSO AT THAT TIME WORKING ON THE NEXT IPHONE THAT

WOULD COME OUT JUST SHORTLY AFTER, IN SEPTEMBER.
SO WE WERE
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DEEPLY INVOLVED IN THAT, AND THAT WOULD BE THE IPHONE 4S,
WHICH, AMONG OTHER CAPABILITIES, BROUGHT TO MARKET SIRI AS PART
OF THAT, THAT'S OUR INTELLIGENT DIGITAL ASSISTANT.
AND CERTAINLY I THINK WHAT'S RELEVANT TO THIS DISCUSSION,
WE WERE CLEARLY IN AN EXTREMELY COMPETITIVE ENVIRONMENT WITH
SAMSUNG AT THE TIME AND THERE WAS A LOT GOING ON RELATIVE TO
THAT.
Q.
ACTUALLY, THAT'S WHAT I NOW WANT YOU TO FOCUS ON.

CAN YOU DESCRIBE FOR US IN SOME DETAIL WHAT APPLE'S
10
COMPETITIVE VIEW OF SAMSUNG WAS IN AND AROUND AUGUST OF 2011?
11
A.
12
THE SHOCK OF SEEING SAMSUNG START TO COPY SOME OF OUR PRODUCTS
13
AND WAS WELL AWARE THAT THEY HAD A STRATEGY TO COME AFTER
14
APPLE, BOTH NOT ONLY IN PRODUCTS, BUT IN THEIR MARKETING.
15
WELL, AS I HAD STATED EARLIER, I ALREADY HAD EXPERIENCED
AND IT'S CERTAINLY NOT A COMPANY THAT I WOULD SAY WE HAD,
16
AT LEAST I WAS AWARE OF A FRIENDLY RELATIONSHIP WITH, THIS
17
COMPANY THAT WAS COMING AFTER YOUR PRODUCTS AND YOUR CUSTOMERS
18
AND STATED SO MUCH AS THAT.
19
20
IT WASN'T A GOOD RELATIONSHIP, AND WE SAW IT GROWING AS A

VERY COMPETITIVE ENVIRONMENT BETWEEN THE TWO COMPANIES.
21
Q.
22
PATENTS AT ISSUE IN THIS CASE IN AUGUST OF 2011, WOULD THOSE
23
FACTORS HAVE PLAYED A ROLE IN APPLE'S DECISION MAKING?
24
A.
25
HAD THERE BEEN DISCUSSIONS ABOUT LICENSING THE FIVE
I -MR. PRICE:
YOUR HONOR, I'M GOING TO OBJECT.
LACK OF
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FOUNDATION.
UNDISCLOSED.
THIS IS EXPERT TESTIMONY, AND IT'S BEEN
MR. MCELHINNY:
THIS WAS WHAT WAS GOING ON IN APPLE'S
EXECUTIVES HEADS, YOUR HONOR.
MR. PRICE:
ON A HYPOTHETICAL?
THE COURT:
I'LL ALLOW ONE LIMITED QUESTION AND THEN
YOU NEED TO MOVE ON.
MR. MCELHINNY:
9
10
GOT IT?
(RECORD READ.)
12
THE WITNESS:
YES, THEY WOULD, VERY MUCH SO.
13
BY MR. MCELHINNY:
14
Q.
15
APPLE IN THE MARKETPLACE?
16
A.
I BELIEVE SO.
17
Q.
AND IN WHAT WAYS?
18
SIR, HAS SAMSUNG'S INFRINGEMENT OF APPLE'S PATENTS HARMED
MR. PRICE:
CALLS FOR EXPERT
OPINION, UNDISCLOSED.
20
21
I WILL, YOUR HONOR.
CAN I ASK YOU TO REPEAT THE QUESTION, PLEASE, SO THAT I'VE
11
19
THEY HAD A MARKETING.
MR. MCELHINNY:
FACT OF INJURY.
22
THIS IS BASIC PERCIPIENT WITNESS TESTIMONY.
THE COURT:
23
THIS IS THE NATURE -- THIS IS THE
OVERRULED.
GO AHEAD, PLEASE.
24
BY MR. MCELHINNY:
25
Q.
LET ME ASK YOU THE QUESTION AGAIN.
HAS SAMSUNG'S
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INFRINGEMENT HARMED APPLE IN THE MARKETPLACE?
A.
YES, I BELIEVE SO.
MR. PRICE:
YOUR HONOR, I'M GOING TO ALSO OBJECT IT
ASSUMES FACTS NOT IN EVIDENCE AT THIS POINT.
TESTIMONY COMPARING THESE PATENTS TO WHAT'S IN THESE PRODUCTS
EXCEPT FOR YOUR ONE RULING.
THE COURT:
8
9
THERE'S BEEN NO
OVERRULED.
GO AHEAD, PLEASE.
BY MR. MCELHINNY:
10
Q.
DO YOU HAVE THE QUESTION IN MIND?
11
A.
YES.
12
Q.
OKAY.
13
THIS TIME.
14
A.
15
MARKETPLACE.
16
INNOVATIONS THAT WE'VE CREATED AND APPLE'S ROLE AS THE
17
INNOVATOR.
18
COULD YOU ANSWER IT?
I THINK YOU CAN ANSWER IT
GO AHEAD.
I BELIEVE IT HAS CAUSED DAMAGE FOR APPLE IN THE

IT HAS CAUSED PEOPLE TO QUESTION SOME OF THE
I THINK IT HAS CONFUSED PEOPLE AS TO WHICH PRODUCTS ARE,
19
ARE CREATING THIS EXPERIENCE AS THE MOST EASY TO USE AND WILL
20
BEST SERVE CUSTOMER'S NEEDS, AND I THINK THAT CHALLENGE IS MADE
21
HARDER BY THE COPYING AND THAT HURTS APPLE IN THOSE EFFORTS.
22
Q.
23
TODAY THAT APPLE WAS OPPOSED TO FAIR COMPETITION IN THE
24
MARKETPLACE.
25
THERE WAS A SUGGESTION IN ONE OF THE OPENING ARGUMENTS
IS THAT TRUE?
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A.
NOT AT ALL.
Q.
WHAT IS APPLE'S VIEW ABOUT FAIR COMPETITION IN THE
MARKETPLACE?
A.
MAKE BETTER PRODUCTS.
COMPANIES COMPETING WITH EACH OTHER TO MAKE BETTER PRODUCTS AND
OFFER, OFFER THINGS TO THEM.
8
9
10
WELL, COMPETITION IS GREAT.
COMPETITION PUSHES US ALL TO
IT HELPS THE CUSTOMER.
THEY BENEFIT BY
BUT THE WAY IN WHICH THAT COMPETITION HAPPENS MATTERS.

COMPANIES NEED TO CREATE NEW PRODUCTS, THINK OF NEW IDEAS,
SOLVE PROBLEMS IN NEW WAYS.
11
THAT IS HOW THE CUSTOMER BENEFITS.
AND THAT'S HOW WE ALL COMPETE WITH EACH OTHER.
I THINK
12
COMPETITION IS A GREAT THING WHEN DONE WELL AND DONE TO THE
13
BENEFIT OF THE CUSTOMER.
14
MR. MCELHINNY:
15
THE COURT:
ALL RIGHT.
16
MR. PRICE:
MAY WE HAVE A MINUTE TO SET UP?
17
THE COURT:
SURE, I'LL GIVE YOU TIME TO SET UP.
18
I HAVE NOTHING FURTHER, YOUR HONOR.
19
MR. PRICE:
YOUR HONOR?
20
THE COURT:
ALL RIGHT.
21
4:04.
22
ARE YOU READY.
TIME IS NOW
GO AHEAD, PLEASE.
MR. PRICE:
23

CROSS-EXAMINATION
24
BY MR. PRICE:
25
Q.
MR. SCHILLER, WE WERE JUST TALKING ABOUT COMPETITION, AND
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I BELIEVE THAT IT HAS BEEN YOUR TESTIMONY THAT WHEN YOU WERE AT
APPLE AND APPLE CAME OUT IN 2007 WITH THAT IPHONE, YOU EXPECTED
THAT IN THE FUTURE, THERE WOULD BE OTHER SMARTPHONE COMPANIES.
CORRECT?
A.
YES.
Q.
AND IT WAS YOUR OBSERVATION THAT, YOU KNOW, THAT COMPANIES
TENDED TO FOLLOW TRENDS WITHIN THE SMARTPHONE INDUSTRY.
HAD OBSERVED THAT?
A.
I'M NOT SURE WHAT YOU MEAN BY "TRENDS."
10
Q.
LIKE FOR A WHILE THERE WERE THESE FLIP PHONES, YOU KNOW.
11
THERE WERE, YEAR TO YEAR, THINGS IN THE MARKET THAT, THAT
12
MANUFACTURERS OFFERED THAT MIGHT BE SIMILAR.
13
A.
14
15
YOU
YES, THAT DID HAPPEN WITH THE FLIP PHONES.

I'M NOT SURE ABOUT THE QUESTION WITH SMARTPHONES WHAT YOU
MEAN.
16
Q.
WELL, YOU CERTAINLY EXPECTED COMPETITION IN THE SMARTPHONE
17
MARKET; CORRECT?
18
A.
YES.
19
Q.
AND YOU KNEW THAT OTHER COMPANIES WERE ALLOWED TO COMPETE
20
WITH APPLE IN THE SMARTPHONE MARKET AS LONG AS THOSE COMPANIES
21
DIDN'T DO THINGS THAT APPLE ITSELF HAD THE SOLE RIGHT TO DO;
22
CORRECT?
23
A.
24
PEOPLE HAVE, COMPANIES HAVE THE RIGHTS TO DO AND NOT DO.
25
PREFER NOT TO RESPOND AS A LAWYER.
I'M NOT SURE IF YOU'RE ASKING A LEGAL QUESTION ABOUT WHAT
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I JUST KNOW GENERALLY AS A MARKETER WHAT, WHAT IS GOOD

COMPETITION AND -- BUT I SHOULDN'T SPEAK ON A LEGAL BASIS.
Q.
THINK YOUR ATTORNEY ASKED YOU SOME QUESTIONS ABOUT WHETHER YOU
WERE FAMILIAR WITH THE PATENTS IN THIS CASE.
WELL, I DON'T WANT YOU TO SPEAK ON A LEGAL BASIS, BUT I
DO YOU RECALL THAT?
A.
YES, AND I AM GENERALLY FAMILIAR WITH THE FIVE PATENTS.
Q.
AND WHAT PATENTS DO IS THEY GIVE A COMPANY THE SOLE RIGHT
TO DO A PARTICULAR THING; CORRECT?
10
A.
I BELIEVE SO.
11
Q.
AND SO TO FIND OUT WHETHER OR NOT SOMEONE IS DOING
12
SOMETHING YOU HAVE THE SOLE RIGHT TO DO, YOU REALLY HAVE TO
13
LOOK AT THE LANGUAGE OF THE PARTICULAR PATENT CLAIM; CORRECT?
14
A.
15
CLAIMS IN A PATENT.
16
BETTER ANSWERED BY A LAWYER IF WE'RE GOING TO GET INTO WHAT
17
CLAIMS MEAN.
18
Q.
19
THAT YOU'RE NOT REALLY IN A POSITION TO SAY, YOU KNOW, WHETHER
20
OR NOT SAMSUNG CAN USE A PARTICULAR METHOD, FOR EXAMPLE, FOR
21
WORD SUGGESTION OR A PARTICULAR METHOD FOR SLIDE TO UNLOCK
22
BECAUSE YOU'RE NOT A LAWYER AND HAVEN'T REALLY COME TO TERMS
23
WITH THOSE CLAIMS IN THAT DETAIL; CORRECT?
24
A.
25
IMPLEMENTATION OF A PATENT IS LEGAL OR NOT.
I -- AGAIN, I'M NOT AN EXPERT ON THE DIFFERENCE BETWEEN
OKAY.
I THINK THAT'S A LEVEL OF DETAIL THAT'S
WELL, SO I GUESS WHAT YOU'RE TELLING ME IS THAT, IS
YES, I'M NOT A LAWYER AND I SHOULDN'T SAY WHETHER SPECIFIC
THAT'S FOR OTHERS
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TO SAY.
Q.
THAT PHONE IN 2007, WHICH WE HEARD ALL THE APPLAUSE FOR ON THE
VIDEO EARLIER, THAT APPLE MADE AN EASY TO USE SMARTPHONE;
CORRECT?
A.
YES, WE SURE DID.
Q.
AND YOU UNDERSTAND THAT OTHER COMPANIES WERE ALLOWED TO
COMPETE WITH APPLE TO MAKE SMARTPHONES THAT WERE EASY TO USE AS
LONG AS -- AS LONG AS THEY WEREN'T USING APPLE'S PATENTED WAY
AND SO YOU MENTIONED, FOR EXAMPLE, THAT APPLE CAME OUT --
10
OF DOING IT; THAT IS, USING WAYS THAT ONLY APPLE HAD THE RIGHT
11
TO DO; CORRECT?
12
A.
I BELIEVE SO.
13
Q.
OKAY.
14
ME STEP BACK AGAIN.
15
16
AND SO IF YOU'RE LOOKING AT WHETHER OR NOT -- LET
SO IT WASN'T YOUR VIEW THAT, THAT, FOR EXAMPLE, ANDROID,

WHICH YOU UNDERSTAND WAS CREATED BY GOOGLE; CORRECT?
17
A.
YES.
18
Q.
SO IT WASN'T YOUR UNDERSTANDING THAT GOOGLE, IN CREATING
19
AN ANDROID OPERATING SYSTEM, HAD TO COME UP WITH SOMETHING HARD
20
TO USE.
21
22
MR. MCELHINNY:
BEYOND THE SCOPE, YOUR HONOR.
DIDN'T MENTION THE WORD "GOOGLE" ONCE IN MY EXAMINATION.
23
MR. PRICE:
HE SAID --
24
THE COURT:
OVERRULED.
25
GO AHEAD.
YOU MAY ANSWER.
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2
THE WITNESS:
I'M SORRY.
COULD I HAVE THE QUESTION
AGAIN.
MR. PRICE:
SURE.
Q.
LET ME JUST CHECK SOMETHING.
DIDN'T YOU TALK ABOUT EASE
OF USE FOR ANDROID.
ANDROID?
A.
IN THE CHART, YES.
Q.
AND YOU LOOKED AT SURVEYS CONCERNING THE USE OF USE FOR
ANDROID; RIGHT?
DIDN'T YOU COMMENT ABOUT EASE OF USE FOR
10
A.
YES.
11
Q.
AND YOUR UNDERSTANDING IS THAT ANDROID IS CREATED BY
12
GOOGLE; CORRECT?
13
A.
YES.
14
Q.
SO I JUST WANT TO MAKE SURE, IT'S NOT YOUR TESTIMONY THAT
15
JUST BECAUSE APPLE CAME OUT WITH THIS REMARKABLE PHONE IN 2007,
16
THAT GOOGLE, IN COMPETING, HAD TO COME OUT WITH SOMETHING HARD
17
TO USE.
18
A.
NO.
19
Q.
I MEAN, GOOGLE WAS ALLOWED TO DEVELOP SOFTWARE THAT WAS
20
EASY TO USE SO LONG AS IT DID NOT VIOLATE APPLE'S RIGHTS;
21
CORRECT?
22
MR. MCELHINNY:
OBJECTION.
23
GOOGLE IS NOT A PLAYER IN THIS CASE.
24
THE QUESTION HAS BEEN ABOUT SAMSUNG.
25
THE COURT:
RELEVANCE, YOUR HONOR.

THEY'RE NOT A DEFENDANT.
OVERRULED.
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GO AHEAD, PLEASE.
THE WITNESS:
I'M SORRY.
COULD I HAVE THE QUESTION
AGAIN, PLEASE.
BY MR. PRICE:
Q.
TO USE THAT COMPETED WITH APPLE SO LONG AS IT DIDN'T DO IT IN A
WAY THAT VIOLATED APPLE'S RIGHTS; CORRECT?
A.
I BELIEVE SO.
Q.
OKAY.
SURE.
GOOGLE COULD DEVELOP ANDROID SOFTWARE THAT WAS EASY
SO LET'S GO BACK THEN TO, TO, IF I CAN, TO THAT
10
2007 TIMEFRAME WHEN WE WERE LOOKING -- WE SAW ALL THOSE REVIEWS
11
OF THE IPHONE -- THAT FIRST IPHONE.
12
AND THERE WAS A LOT OF DEMAND FOR THAT IPHONE; CORRECT?
13
A.
YES, THERE WAS.
14
Q.
OKAY.
15
ACCUSED -- THAT ARE BEING ASSERTED IN THIS CASE, THE PATENT
16
CLAIMS, AT LEAST FOUR OF FIVE OF THEM HAD NOTHING TO DO WITH
17
THE DEMAND FOR THAT FIRST IPHONE; CORRECT?
18
NOW, WE KNOW, HOWEVER, THAT THE PATENTS THAT ARE
MR. MCELHINNY:
MAY WE
19
APPROACH?
THERE IS A LIMITATION ON WHAT WE'RE ALLOWED TO
20
ASSERT IN THIS CASE, BUT THE WITNESS HAS TO ANSWER QUESTIONS
21
HONESTLY IF THEY'RE ASKED IN THAT FORM.
22
THE COURT:
23
MR. MCELHINNY:
24
25
THE COURT:
GIVE ME ONE MINUTE, PLEASE.

YOU MAY ANSWER.
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BY MR. QUINN:
Q.
DO YOU REMEMBER THE QUESTION?
A.
YES.
PART OF WHAT CREATED DEMAND IN THE BEGINNING.
Q.
YOU ASKED ABOUT WHETHER PATENTS IN THE IPHONE WERE A

IS THAT CORRECT?
NO, THAT'S NOT MY QUESTION.

MY QUESTION WAS THAT THE PATENT CLAIMS THAT YOU ARE
ASSERTING, THAT APPLE IS ASSERTING IN THIS CASE, THAT THOSE
CLAIMS HAD NOTHING TO DO WITH THE DEMAND FOR THAT IPHONE IN
2007 BECAUSE THAT IPHONE DID NOT PRACTICE FOUR OF THOSE FIVE
10
CLAIMS?
11
A.
12
CLAIMS ON THE PATENTS THAT YOU'RE DISCUSSING HERE THAT ARE
13
ASSERTED.
14
15
SO IF YOU WANT TO TALK MORE BROADLY ABOUT THE PATENTS,

WHICH I'M NOT SUGGESTING, THAT'S THE AREA I KNOW.
16
17
I'M -- I'M FAMILIAR WITH THE PATENTS, NOT THE INDIVIDUAL
INDIVIDUAL ASSERTIONS OF CLAIMS I THINK IS FOR OTHERS TO

SPEAK TO.
18
Q.
OKAY.
SO WHAT YOU'RE TELLING US IS THAT YOU PERSONALLY
19
AREN'T FAMILIAR WITH THE ACTUAL PATENT CLAIMS THAT APPLE IS
20
ASSERTING IN THIS CASE THAT SAMSUNG HAS INFRINGED IN ITS
21
PHONES?
22
A.
23
EXPERTISE, NO.
24
Q.
25
OF -- I'M GOING TO TRY TO GET THE WORDS -- YOU WERE TALKING
IS THAT WHAT YOU'RE SAYING?
THE ASSERTION OF THE PATENT CLAIMS ARE NOT MY AREA OF
AND SO WHEN YOU WERE SAYING, TALKING ABOUT THE EFFECT
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ABOUT THE EFFECT OF COPYING OF THE IPHONE -- DO YOU RECALL THAT
IN THE LAST PART OF YOUR TESTIMONY?
A.
YES.
Q.
OKAY.
WEREN'T TALKING ABOUT THE EFFECT OF ANYONE USING THE PARTICULAR
CLAIMS THAT ARE ASSERTED IN THIS CASE BECAUSE YOU DON'T EVEN
KNOW WHAT THOSE CLAIMS ARE?
A.
WHICH INCLUDE MANY THINGS, AND NOT ABOUT ANY SPECIFIC CLAIM
CORRECT?
SO WHEN YOU WERE TALKING ABOUT THAT EFFECT, YOU
I WAS TALKING ABOUT THE TOTALITY OF ALL OF THE COPYING,
10
ASSERTION.
11
Q.
12
DECIDE IS ABOUT A SPECIFIC NUMBER OF PRODUCTS AND SPECIFIC -- I
13
THINK FIVE SPECIFIC CLAIMS?
14
A.
YES.
15
Q.
OKAY.
16
THERE WAS ALL THIS EXCITEMENT ABOUT.
17
AND YOU UNDERSTAND THAT THIS CASE THAT THE JURY IS TO
DO YOU UNDERSTAND THAT MUCH?
AND SO LET'S TALK ABOUT THAT 2007 IPHONE WHICH
NOW, IT -- I GUESS IT DOESN'T HAVE A -- IT DOESN'T HAVE A
18
FORWARD FACING CAMERA SO YOU COULDN'T DO A SELFIE LIKE
19
ELLEN DEGENERES DID IN THE OSCARS; RIGHT?
20
A.
I'M SORRY.
WOULD ELLEN DEGENERES USE -- AGAIN, I WASN'T
21
INVOLVED IN THAT, SO I'M NOT SURE WHAT EXACTLY SHE USED.
22
MAYBE YOU CAN TELL ME.
23
Q.
YOU DIDN'T WATCH THE OSCARS?
24
A.
NO, I DIDN'T.
25
Q.
AH.
SO
I WAS TRAVELLING THAT NIGHT UNFORTUNATELY.
WELL, IN ANY EVENT, THAT FIRST IPHONE THAT WE WERE
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TALKING ABOUT CAME OUT IN 2007.
TIME; CORRECT?
A.
NO.
Q.
AND THERE WAS NO VIDEO; CORRECT?
A.
WELL, IT PLAYED VIDEOS, YES.
Q.
COULD IT TAKE VIDEOS?
A.
IT DID NOT HAVE A VIDEO CAMERA, NO.
Q.
I APOLOGIZE FOR BEING A LITTLE BIT UNCLEAR THERE.
THERE WAS NO APP STORE AT THAT
THE APP STORE CAME A YEAR LATER.
IT DIDN'T HAVE 3G; CORRECT?
10
A.
11
WAS USED.
12
Q.
AND THAT'S -- IS THAT SLOWER THAN 3G GENERALLY?
13
A.
DEPENDS.
14
HAVE TO BE AT THE TIME.
15
Q.
16
AGREE?
17
A.
I THINK SO, THANKS.
18
Q.
SO IF WE LOOK AT THAT PRODUCT -- I WANT TO LOOK, IF WE
19
COULD, AT A SERIES OF PRODUCTS.
20
IN FRONT OF YOU -- NOT THE GREEN ONE.
21
DEPOSITION TESTIMONY.
22
CORRECT.
IT WAS AT&T EDGE NETWORKING WAS THE NETWORK THAT
IT'S VERY COMPLICATED.
IT CAN BE.
IT DOESN'T
SO STILL PRETTY REMARKABLE PRODUCT, ELECTRIFYING?
YES.
I WANT TO LOOK AT THE BINDER

THE GREEN ONE IS YOUR
I WANT TO LOOK AT THE OTHER ONE, AND TOWARD THE END THERE
23
ARE SOME DEMONSTRATIVES, COLORED PICTURES OF PHONES.
24
2312.
25
YOU
AND MAYBE YOU CAN TELL ME -- HAVE YOU FOUND IT?
IT'S SDX
I'VE GOT
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IT UP HERE ON THE SCREEN.
A.
NO.
Q.
THEY KEEP GOING RIGHT AFTER THAT.
A.
I DON'T HAVE ANOTHER TAB AFTER THAT.
Q.
THEY'RE ALL BEHIND THAT TAB.
A.
THERE IS NO TAB 2312.
Q.
I MEAN THERE ARE THREE PAGES AFTER THAT.
I'VE GOT 2310.
THEY DON'T --
AND IF IT'S EASIER, I THINK IT MIGHT BE ON YOUR MONITOR.
A.
I SEE THIS, YES.
10
Q.
AND THIS IS A DEMONSTRATIVE SO I JUST WANT TO GO THROUGH.
11
SO IN JUNE 2007 WHEN YOU CAME OUT WITH THE ORIGINAL
12
IPHONE, ISN'T IT TRUE THAT THAT IPHONE DID NOT USE THE WORD
13
RECOMMENDATION METHODOLOGY THAT'S SET FORTH IN APPLE'S PATENT
14
172, CLAIM 18, THAT APPLE IS SUING ON TODAY?
15
16
MR. MCELHINNY:
SCOPE.
17
LACKS FOUNDATION.
IT'S BEYOND THE
IT'S ASKED AND ANSWERED.

THE COURT:
THAT'S SUSTAINED.
18
BY MR. PRICE:
19
Q.
20
WHETHER OR NOT THAT FIRST IPHONE PRACTICED THE APPLE PATENT
21
'172, CLAIM 18 THAT'S BEING FILED IN THIS CASE?
WELL, LET ME ASK YOU IF YOU KNOW, OKAY?
DO YOU KNOW
22
MR. MCELHINNY:
23
MR. PRICE:
I ASKED HIM IF HE KNOWS.
24
THE COURT:
IT HAS BEEN ASKED AND ANSWERED, BUT I'LL
25
SAME OBJECTION, YOUR HONOR.
ALLOW HIM TO GO AHEAD.
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THE WITNESS:
NO, I'M NOT AN EXPERT ON THE
PROGRAMMING OF THE INDIVIDUAL CLAIMS AND THE ASSERTIONS.
WOULDN'T KNOW.
BY MR. PRICE:
Q.
WENT THROUGH EVERY ONE OF THESE APPLE PHONES FROM THE ORIGINAL
IPHONE UP TO THE 5, IF I WENT THROUGH THOSE AND ASKED YOU
WHETHER OR NOT ANY OF THOSE PHONES PRACTICED ANY OF THE
SPECIFIC CLAIMS IN THIS CASE, WOULD YOU KNOW THE ANSWER TO
OKAY.
SO I'M GOING TO TRY TO SHORTEN THIS THEN.
SO I
SO IF I
10
THAT?
11
A.
12
THE PATENTS.
13
Q.
14
THIS WONDERFUL, INNOVATIVE DEVICE, THE INVENTION OF THE YEAR,
15
YOU KNOW, YOU CAN'T TELL US WHETHER OR NOT THOSE REVIEWERS
16
ACTUALLY OBSERVED, YOU KNOW, OR SAW, YOU KNOW, ANY
17
IMPLEMENTATION OF THE SPECIFIC PATENT CLAIMS THAT ARE ASSERTED
18
IN THIS CASE?
NO.
I'M NOT THE ONE TO ASK ABOUT ASSERTED CLAIMS WITHIN
OKAY.
THAT'S NOT MY AREA OF EXPERTISE.
SO IN ALL THOSE REVIEWS THAT THE JURY SAW ABOUT
19
MR. MCELHINNY:
20
THE COURT:
21
MR. MCELHINNY:
22
23
24
25
CLAIMS.
I DIDN'T HEAR THE OBJECTION.
WHAT IS IT?
WE'RE STILL TALKING ABOUT SPECIFIC
HE'S SAID NOW 18 TIMES.

THE COURT:
GO AHEAD.
ALL RIGHT.
OVERRULED.
YOU MAY ANSWER.
THE WITNESS:
I CAN'T SAY EITHER WAY.
THEY MAY HAVE.
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THEY MAY NOT HAVE SINCE I DON'T HAVE DEEP KNOWLEDGE OF ASSERTED
CLAIMS.
BY MR. PRICE:
Q.
ASK YOU THIS:
YOU'RE SO PROUD OF THAT APPLE HAS, IF YOU TOOK AWAY A SPECIFIC
EASE OF USE FEATURE, WOULD THAT AFFECT, DO YOU BELIEVE, THE
SALES OF AN APPLE IPHONE?
A.
10
NOW, YOU HAD TALKED A LITTLE BIT ABOUT -- LET ME

WITH RESPECT TO THE TYPES OF FEATURES THAT
HYPOTHETICALLY, YES.
I THINK EASE OF USE IS IMPORTANT AND
WE HAVE A LOT OF THINGS THAT ADD UP TO EASE OF USE.
11
12
OKAY.
BUT DEPENDING ON WHAT THEY ARE AND WHAT THE USER'S

EXPERIENCE IS, IT COULD IMPACT SALES.
13
Q.
14
LET ME STEP BACK A BIT FURTHER FROM THAT.
15
16
WELL, I'M ASKING YOU, DO YOU GENERALLY THINK -- IN FACT,
WITH RESPECT TO EASE OF USE, YOU HAVE ASKED YOUR CUSTOMERS

TO CHECK WHETHER OR NOT EASE OF USE IS IMPORTANT; CORRECT?
17
A.
YES, WE ASKED QUESTIONS ABOUT THAT.
18
Q.
AND IN THOSE SURVEYS, YOU DON'T DEFINE EASE OF USE ANY
19
FURTHER THAN EASE OF USE; CORRECT?
20
A.
CORRECT.
21
Q.
AND YOU -- IN YOUR SURVEYS, DO YOU ASK CUSTOMERS TO
22
COMPARE WHETHER ONE WAY OF DOING, SAY, A WORD RECOMMENDATION AS
23
YOU'RE TYPING IS EASIER TO USE THAN ANOTHER WAY OF DOING A WORD
24
CORRECTION?
25
A.
NO, I DON'T RECALL ASKING THAT QUESTION EVER.
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Q.
OKAY.
HOW ABOUT SYNCING?
WE'VE HEARD THAT WORD SYNCING
USED BEFORE, AND I THINK YOU SAID ACTUALLY THAT IT WAS IN 2011
WHEN -- AUGUST OF 2011 THAT APPLE WAS FIRST COMING OUT WITH
INTRODUCING WIRELESS SYNCING THROUGH THE CLOUD.
A.
5.
Q.
SLIDE 2312 -- AND SO SOMEWHERE AROUND BETWEEN THE 4 AND 4S THAT
APPLE, FOR THE FIRST TIME, CAME OUT WITH THIS WIRELESS SYNCING?
NOT THROUGH THE CLOUD, BUT WIRELESS SYNCING, YES, IN IOS
OKAY.
10
A.
11
CABLE, AND NOW YOU COULD DO IT WIRELESSLY.
12
YES.
SO IF WE CAN -- KEN, IF WE CAN PUT THAT BACK UP,
WE HAD WIRED SYNCING BEFORE YOU COULD DO OVER A
AND IT'S NOT LIMITED BY MODEL.
YOU COULD DO THAT -- YOU
13
COULD OPERATE THE OPERATING SYSTEM ON SOME PREVIOUS DEVICES AND
14
DO THAT AS WELL.
15
Q.
YOU COULD DOWNLOAD THAT SOFTWARE?
16
A.
YES.
17
Q.
OKAY.
18
COMMENT IN OPENING THAT BEFORE APPLE, YOU HAD TO PLUG IN
19
DEVICES IN ORDER TO SYNC YOUR DEVICES.
20
AND SO, FOR EXAMPLE, I MEAN, THERE HAD BEEN A
THAT'S NOT TRUE, IS IT?
21
A.
I'M SORRY.
22
WAS REFERRING TO.
23
ELSE SAID OUT OF CONTEXT.
24
Q.
25
SOME KIND OF A RESPONSIBILITY TO KNOW WHAT WAS IN THE MARKET.
OKAY.
I DON'T KNOW WHAT THAT COMMENT IS AND WHAT IT

I WOULDN'T WANT TO RESPOND TO WHAT SOMEONE
WELL, AS SOMEONE WHO'S HEAD OF MARKETING, YOU HAD
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A.
IT DEPENDS ON THE SITUATION AND WHAT WE'RE TALKING ABOUT.
I'M SORRY.
THAT'S A VERY BROAD STATEMENT.
Q.
YOU HAD THE -- YOU WANTED TO KNOW WHAT YOUR
COMPETITORS WERE DOING, PEOPLE LIKE GOOGLE OR MOTOROLA OR HTC?
A.
SOMETIMES YES, SOMETIMES NO.
Q.
OKAY.
WANT TO GET IT RIGHT HERE.
DIDN'T ONE OF YOUR COMPETITORS ALREADY HAVE WIRELESS SYNCING?
A.
I DON'T KNOW.
10
Q.
ONE WAY OR THE OTHER?
11
A.
I DON'T KNOW EITHER WAY.
12
Q.
OKAY.
13
DOES BACKGROUND SYNCING?
14
A.
NO, I'M NOT FAMILIAR WITH THAT.
15
Q.
DO YOU KNOW WHAT BACKGROUND SYNCING IS?
16
A.
I CAN MAKE A GUESS TO THE TERMINOLOGY.
17
SPECIFICS OF WHAT THE IMPLEMENTATION IS.
18
MAKING UP A GUESS IF YOU ASKED ME TO RESPOND TO THAT.
19
Q.
I DON'T WANT YOU TO GUESS.
20
A.
OKAY.
21
Q.
NOW, WHEN YOU USED THE PHRASE "EASE OF USE" IN YOUR
22
SURVEYS, I THINK YOU TESTIFIED THAT THAT, THAT TERM REFERS TO
23
HUNDREDS OF FEATURES.
24
A.
YES, IT DOES.
25
Q.
AND THAT YOU'VE SAID THAT YOU PERSONALLY COULDN'T RANK
OKAY.
AND SO I'M JUST ASKING YOU, AUGUST -- I'M SORRY.

SO AUGUST 2011, PRIOR TO THEN,
IN ANY EVENT, DO YOU KNOW HOW THE ANDROID SYSTEM
I DON'T KNOW THE
I WOULD BE JUST
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THOSE HUNDREDS OF FEATURES AS TO EASE OF USE?
A.
NO, I DON'T BELIEVE I COULD.
Q.
AND CERTAINLY AS OF JULY 2013, YOU WEREN'T AWARE OF
ANYBODY AT APPLE WHO HAD DONE ANY KIND OF RANKING AS TO THESE
HUNDREDS OF FEATURES OF EASE OF USE?
A.
I'M NOT AWARE THAT WE DID THAT, NO.
Q.
AND I ASKED YOU WHETHER OR NOT, IF YOU TAKE OUT -- IF YOU
TOOK OUT ONE OF THOSE HUNDREDS OF FEATURES OF EASE OF USE,
WHETHER IT WOULD AFFECT APPLE'S SALES.
10
I BELIEVE YOU SAID THAT IT VERY WELL COULD.
11
A.
12
HYPOTHETICALLY ABOUT VAGUE TOPICS.
13
Q.
14
OR NOT THAT WOULD ACTUALLY AFFECT SALES; CORRECT?
15
A.
16
SO MAYBE YOU CAN HELP ME BE MORE SPECIFIC.
17
Q.
18
19
20
IT'S POSSIBLE.
I DON'T KNOW.
WE'RE SPEAKING VERY
WELL, YOU'D WANT TO ACTUALLY LOOK INTO THAT TO SEE WHETHER
AGAIN, I DON'T KNOW WHAT WE'RE TALKING ABOUT REALLY HERE,
OKAY.
I'LL TRY TO BE SPECIFIC.
EASE OF USE, HUNDREDS OF FEATURES.
IF YOU TAKE OUT ONE,
COULD YOU ASSUME THAT THAT'S GOING TO IMPACT APPLE'S SALES?

A.
IT'S POSSIBLE.
I'LL GIVE YOU A SIMPLE FOR INSTANCE.
21
IF I TOOK OUT THE EASE WITH WHICH YOU CAN SIMPLY MAKE A
22
PHONE CALL WITH A PHONE, YOU MIGHT NOT WANT TO BUY THAT PHONE
23
BECAUSE IT'S REALLY HARD TO DO THE ONE THING YOU REALLY NEED TO
24
DO ALL THE TIME.
25
SO IT DEPENDS.
WE WOULD HAVE TO TALK ABOUT THE SPECIFIC
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SITUATION.
Q.
DETERMINE WHETHER OR NOT, IF YOU HAVE ONE FEATURE VERSUS
ANOTHER, WHETHER IT'S GOING TO IMPACT SALES.
AT THE SPECIFIC FEATURE AND ITS IMPACT ON CONSUMERS; CORRECT?
A.
TRYING TO HELP YOU ANSWER YOUR QUESTION, AND IT'S NOT SOMETHING
I'VE HAD TO LOOK AT AND HAD TO STUDY.
9
10
OKAY.
SO YOU CAN'T USE BROAD CATEGORIES OF EASE OF USE TO
AGAIN, I DON'T NEED TO.
YOU NEED TO LOOK
I DO MY JOB IN MARKETING.
I'M
EASE OF USE IS INCREDIBLY IMPORTANT, ONE OF THE MOST

IMPORTANT THINGS IN OUR PRODUCT.
11
BUT I'VE NEVER HAD TO PICK IT APART MYSELF IN MARKETING
12
AND SEGREGATE OUT DIFFERENT FEATURES AND RANK NUMBER VALUE
13
THEM.
14
ABOUT.
SO IT'S NOT SOMETHING I NORMALLY HAVE TO DO AND I THINK
15
Q.
16
THAT -- I MEAN YOU AND YOUR MARKETING TEAM -- AS TO WHAT HELPS
17
DRIVE SALES, OKAY --
18
A.
SURE.
19
Q.
-- OF APPLE PRODUCTS.
20
21
OKAY.
SO LET ME ASK YOU THEN WHAT YOU HAVE LOOKED AT
AND I THINK YOU WOULD PROBABLY AGREE WITH ME THAT YOU

BELIEVE THAT THE APPLE IPHONES ARE THE EASIEST TO USE?
22
A.
I BELIEVE SO.
23
Q.
AND -- BUT YOU'VE -- IN LOOKING AT ONE OF THE SURVEYS IN
24
YOUR DIRECT EXAMINATION WHICH CONCERNED THE USE OR THE FACT
25
THAT THERE WERE NEW CONSUMERS BEING BROUGHT INTO THE MARKET.
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DO YOU REMEMBER THAT?
A.
YES.
Q.
AND LET ME SEE IF I CAN CALL YOUR ATTENTION TO THAT.
WAS, I THINK, EXHIBIT 123-3.
5
6
IF WE CAN PUT THAT UP?
THAT WAS A PX 123-3.
THAT
THAT'S A
PLAINTIFF'S EXHIBIT.
HERE WE GO.
THIS IS THE ONE YOU WERE TALKING ABOUT IN THE
PERCENTAGE OF FIRST-TIME SMARTPHONE BUYERS AND HOW IT HAD GROWN
UP THROUGH FISCAL YEAR, AND WE WERE TALKING ABOUT THESE
10
NUMBERS, 60 PERCENT, 47 PERCENT, ET CETERA; CORRECT?
11
A.
YES.
12
Q.
AND OBVIOUSLY -- AND I GUESS YOU WERE SAYING THAT A LOT OF
13
PEOPLE BEFORE, YOU KNOW, THIS TIMEFRAME, WERE USING PHONES THAT
14
WEREN'T SMARTPHONES.
15
A.
CORRECT.
16
Q.
IS THERE A TERM IN THE INDUSTRY FOR THOSE SORTS OF PHONES?
17
A.
YES.
18
Q.
AND YOU'VE GOT SOME EXPERTISE, YOU BELIEVE YOU HAVE A
19
SIGNIFICANT AMOUNT OF EXPERTISE, AT LEAST YOU BELIEVE, IN DOING
20
SURVEYS; CORRECT?
21
A.
YES.
22
Q.
YOU'VE DONE THEM MOST OF YOUR LIFE?
23
A.
CERTAINLY SINCE COLLEGE, YES.
24
Q.
OKAY.
25
A.
A VERY LONG TIME AGO.
WE CALL THEM FEATURE PHONES.
WHICH IS -- WELL, WHICH HAS BEEN MOST OF YOUR LIFE?
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(LAUGHTER.)
BY MR. PRICE:
Q.
SURVEY?
YEAH.
AND THERE'S A GOOD WAY AND A BAD WAY TO DO A
YOU AGREE WITH THAT?
ACTUALLY, BAD QUESTION.
THERE ARE GOOD AND BETTER WAYS TO DO SURVEYS; CORRECT?
A.
OFTEN THAT'S TRUE.
Q.
AND WHAT YOU FOUND IS THAT YOU LIKE ASKING QUESTIONS OF
PEOPLE ABOUT WHAT DO YOU THINK, KIND OF OPEN-ENDED QUESTIONS,
10
AND THEN TRY TO LEARN FROM THEM?
11
A.
12
I'M SORRY.
I THINK THAT'S TAKEN OUT OF CONTEXT.
I THINK YOU CAN ASK PEOPLE WHAT THEY THINK.
I DON'T LIKE
13
OPEN-ENDED QUESTIONS AS MUCH IN TERMS OF -- I MEAN, YOU CAN ASK
14
THEM.
15
16
IT'S NOT GOOD OR BAD.

BUT I THINK YOU GET A MORE DEFINITIVE, CLEAR RESULT IF
THERE'S A SPECIFIC LIST OF THINGS TO PICK FROM.
17
I THINK WHEN YOU MADE THAT STATEMENT, I BELIEVE I WAS MORE
18
REFERRING TO IT'S BETTER TO ASK PEOPLE, IN MY SURVEYS FOR
19
MARKETING, ABOUT THINGS THEY HAVE A KNOWLEDGE OF, LIKE WHAT
20
THEY THINK OF THEIR PHONE, VERSUS THINGS THAT THEY DON'T HAVE
21
KNOWLEDGE OF.
22
23
24
25
BUT THAT'S IN MY MARKETING SURVEYS.

Q.
SO LET ME FOLLOW UP THEN.

IN YOUR SURVEYS, YOU PREFER TO ASK PEOPLE THINGS WHAT THEY
HAVE A KNOWLEDGE OF RATHER THAN GIVING THEM KNOWLEDGE AND THEN
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ASKING THEM ABOUT IT?
A.
ON THE WORK I DO, YES.
Q.
I'M SORRY.
A.
YES.
Q.
AND, IN FACT, YOU SAID THAT, THAT YOU -- YOU DON'T TRY TO
CREATE A SURVEY WHERE YOU ACTUALLY HAVE TO PUT SOMETHING IN
THEIR HEAD TO THEN GET IT OUT?
A.
DONE.
I COULDN'T HEAR YOU.
FOR THE WORK I DO, YES.
I THINK THAT'S MORE DIFFICULT.
IT CAN BE DONE.
IT IS
BUT I THINK IT'S A MORE DIFFICULT METHODOLOGY.
10
Q.
11
INSTEAD OF ASKING SOMETHING THEY'RE ALREADY KNOWLEDGEABLE
12
ABOUT, YOU HAVE TO TELL THEM ABOUT SOMETHING, YOU FIND THAT
13
THAT DATA, IN YOUR EXPERIENCE, IS LESS RELIABLE.
14
A.
IT DEPENDS ON THE QUESTION.
15
Q.
WELL, WHEN YOU SAY, QUOTE, "HERE'S SOMETHING YOU DIDN'T
16
KNOW, LET ME TELL IT TO YOU, AND NOW YOU TELL ME BACK WHAT YOU
17
THINK, WELL, THAT'S GETTING LESS RELIABLE DATA"?
18
19
20
AND YOU SAID THAT IF YOU USE THAT METHODOLOGY WHERE,
IT CAN BE.
YOU AGREE WITH THAT; CORRECT?

A.
I THINK GENERALLY IT IS BUT NOT ALWAYS.

A SIMPLE EXAMPLE, IF I ASKED YOU, WOULD YOU BE UPSET
21
TOMORROW IF THE SUN NEVER CAME UP AGAIN?
22
PRETTY EASY ONE.
23
VERY UPSET, AND I THINK THAT WOULD BE A VERY RELIABLE ANSWER.
24
I MIGHT ASK SOMETHING MORE DIFFICULT FOR YOU TO IMAGINE
25
I THINK THAT'S A
I THINK WE WOULD ALL SAY, YES, WE WOULD BE
AND THAT MIGHT NOT BE RIGHT.
I THINK IT DEPENDS.
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Q.
AND YOU'RE TALKING ABOUT YOUR EXPERIENCE DOING SURVEYS,
MOST OF THAT IS WITH SMARTPHONES?
A.
NO.
Q.
PRODUCT?
A.
NO.
Q.
WHAT'S IT WITH?
A.
QUITE A LOT.
EARLY '80S.
I'VE PLAYED WITH A NUMBER OF THINGS.
I'VE DONE IT IN MEDICAL RESEARCH, OTHER PRODUCTS,
10
Q.
11
YOU DIDN'T KNOW, LET ME TELL IT TO YOU, AND NOW YOU TELL ME
12
BACK WHAT YOU THINK, THAT'S GETTING LESS RELIABLE DATA THAN
13
ASKING THEM ABOUT WHAT THEY ALREADY KNOW ABOUT," DO YOU AGREE
14
WITH THAT?
15
A.
I THINK THAT'S TRUE IN MANY SITUATIONS.
16
Q.
OKAY.
17
OKAY.
AS I SAID, I'VE BEEN DOING THIS SINCE THE
SO ACROSS THE BOARD, WHEN YOU SAY "HERE'S SOMETHING
AND IF WE CAN PUT BACK UP THAT DOCUMENT, 133.
OH, NO.
18
THE COURT:
TIME IS 4:31.
IS THIS A QUICK QUESTION?
19
MR. PRICE:
YEAH, IF I CAN ASK THAT QUICK QUESTION
20
ABOUT THE SURVEY THEN.
21
Q.
22
YEARS, FISCAL YEARS TWO, THREE, FOUR HERE -- I'M SORRY.
23
FISCAL YEAR '11, '12, '13, FISCAL YEAR, FOURTH QUARTER.
24
25
AND WHAT YOU'RE SAYING THE TREND IS SHOWING US IN THE
DO YOU SEE THOSE?

A.
YES.
'12 --
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Q.
ABOUT THE SMARTPHONES THAN PEOPLE WHO ALREADY OWN SMARTPHONES
THAT ARE COMING INTO THE MARKET; CORRECT?
A.
SMARTPHONE.
FOR A SHORT PERIOD OF TIME IS LESS KNOWLEDGEABLE THAN SOMEONE
WHO'S OWNED IT FOR ONE OR TWO YEARS, I WOULDN'T SAY THAT THAT'S
WHAT THIS DATA SAYS.
9
10
YOU'RE GETTING A LOT OF PEOPLE WHO MAY HAVE LESS KNOWLEDGE
NO, I WOULDN'T SAY THAT.
THESE ARE PEOPLE WHO NOW OWN A
AND TO SUGGEST THAT SOMEONE WHO OWNS A SMARTPHONE
THERE'S NO QUESTION HERE ABOUT THEIR KNOWLEDGE.

Q.
AND I APOLOGIZE ABOUT --
11
THE COURT:
IT IS 4:32.
12
MR. PRICE:
I'LL CLARIFY TOMORROW.
13
THE COURT:
IT'S TIME TO GO.
ACTUALLY, WE'RE NOT
14
GOING TO BE IN SESSION TOMORROW OR THURSDAY, BUT WE'LL RESUME
15
ON FRIDAY MORNING AT 9:00 A.M. WITH MR. PRICE'S CROSS OF
16
MR. SCHILLER.
17
18
19
YOU'RE EXCUSED NOW.

CASE.
AND, MR. DUNHAM, LOTS OF VITAMIN C AND REST.
20
JUROR:
21
THE COURT:
22
23
24
25
PLEASE DO NOT RESEARCH OR DISCUSS THE
FRIDAY MORNING.
I'LL BE FINE.
OKAY.
THANK YOU.
WE'LL SEE YOU ALL ON
IF YOU WOULD PLEASE LEAVE YOUR JURY BINDERS IN THE JURY

DELIBERATION ROOM.
THANK YOU.
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2
3
4
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THE COURT:
YOU MAY STEP DOWN.
THE RECORD SHOULD REFLECT THE JURORS HAVE LEFT THE

COURTROOM.
ARE THERE ANY ISSUES OR SHOULD WE GO AHEAD AND ADJOURN
OURSELVES FOR THE DAY?
MS. MAROULIS:
THE COURT:
MR. MCELHINNY:
THE COURT:
10
NONE FOR SAMSUNG, YOUR HONOR.
ALL RIGHT.
NO?
ANYTHING FOR APPLE?
NOTHING FOR APPLE, YOUR HONOR.

ALL RIGHT.
THANK YOU.
WE'LL SEE
YOU ON FRIDAY MORNING THEN AT 9:00 O'CLOCK.
11
12
MR. MCELHINNY:
OUR NEXT
13
WITNESS IN ORDER IS HERE AND I JUST WANT TO LET HIM SIT IN THE
14
WITNESS CHAIR AND GET A FEEL FOR IT.
15
SECOND.
16
THE COURT:
IT'LL ONLY TAKE ONE
I NEED TO NOTIFY SAMSUNG -- EXCUSE ME.
17
THERE'S BEEN A REQUEST TO HAVE THE NEXT WITNESS SIT IN THE
18
CHAIR SO HE CAN KNOW WHAT IT FEELS LIKE.
19
OBJECTION?
20
MR. QUINN:
21
MR. MCELHINNY:
22
THE COURT:
23
MR. MCELHINNY:
24
25
IS THERE ANY
NO.
THANK YOU.
IS HE HERE?
HE IS HERE.
WE'LL GO AHEAD, YOUR
HONOR.
THE COURT:
ALL RIGHT.
I'M GOING TO STAY TO
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CHAPERONE.
MR. MCELHINNY:
MR. MCELHINNY:
THE COURT:
MR. MCELHINNY:
OWN SET OF BINDERS.
OKAY.
YOU'LL HAVE WATER, YOU'LL HAVE YOUR
BE CAREFUL, DON'T ROLL OFF.
(DISCUSSION OFF THE RECORD.)
10
THE WITNESS:
11
THE COURT:
12
YOUR HONOR, THIS IS MR. CHRISTIE.
HE'LL BE OUR NEXT WITNESS.
ALL RIGHT.
I APPRECIATE IT.
OKAY.
(THE EVENING RECESS WAS TAKEN AT 4:35 P.M.)
13
14
15
16
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20
21
22
23
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CERTIFICATE OF REPORTERS
3
4
5
6
7
WE, THE UNDERSIGNED OFFICIAL COURT REPORTERS OF THE
UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
CALIFORNIA, 280 SOUTH FIRST STREET, SAN JOSE, CALIFORNIA, DO
10
11
HEREBY CERTIFY:
THAT THE FOREGOING TRANSCRIPT, CERTIFICATE INCLUSIVE, IS
12
A CORRECT TRANSCRIPT FROM THE RECORD OF PROCEEDINGS IN THE
13
ABOVE-ENTITLED MATTER.
14
15
16
______________________________
17
18
19
_______________________________
20
21
DATED:
APRIL 1, 2014
22
23
24
25
EXHIBIT 2
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Document 1340-40<=87#)"$+"$'
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1
SAN JOSE DIVISION
4
5
6

CORPORATION,
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8
9
10
11
12
13
PLAINTIFF,
VS.
DEFENDANTS.
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
C-12-00630 LHK
APRIL 22, 2014
VOLUME 11
PAGES 2620-2873
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15
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22

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24
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1
2
FOR PLAINTIFF
APPLE:
4
5
MORRISON & FOERSTER

RACHEL KREVANS
425 MARKET STREET
94105
6
7

HALE AND DORR
BY: WILLIAM F. LEE
60 STATE STREET
8
9
10
BY: MARK D. SELWYN

950 PAGE MILL ROAD
11
94304
12
13
15

BY: JOHN B. QUINN
WILLIAM PRICE
16
BY:
14
17
18
FOR SAMSUNG:
KEVIN B. JOHNSON
SUITE 560
19
20
21
22
23
24
25
94065
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1
INDEX OF WITNESSES
DEFENDANTS'
KENNETH PARULSKI
DIRECT EXAM BY MR. JOHNSON (RES.)
CROSS-EXAM BY MR. LEE
P. 2624
P. 2627
SANJAY RAO
DIRECT EXAM BY MR. CEDERBERG
P. 2645
P. 2553
JAMES KEARL
DIRECT EXAM BY MR. CEDERBERG
REDIRECT EXAM BY MR. CEDERBERG
P. 2656
P. 2669
P. 2677
4
5
6
7
8
9
10
PLAINTIFFS'
11
TIM MILLET
DIRECT EXAM BY MS. TALLON
CROSS-EXAM BY MR. JOHNSON
P. 2687
P. 2701
ROBERTO GARCIA
DIRECT EXAM BY MR. SELWYN
P. 2703
TRACEY MAZUR
BY DECLARATION
P. 2716
JAMES STORER
DIRECT EXAM BY MR. SELWYN
CROSS-EXAM BY MR. JOHNSON
P. 2718
P. 2779
JAMES MACCOUN
BY VIDEOTAPED DEPOSITION
P. 2785
TODD MOWRY
FURTHER DIRECT EXAM BY MS. KREVANS
P. 2787
MARK ALEXANDER SNOEREN

FURTHER DIRECT EXAM BY MS. KREVANS
FURTHER CROSS-EXAM BY MR. PAK
P. 2812
P. 2850
ANDREW COCKBURN
FURTHER REDIRECT EXAM BY MR. MCELHINNY
P. 2859
12
13
14
15
16
17
18
19
20
21
22
23
24
25
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THE PARTIES HAVE AGREED, WE UNDERSTAND THAT YOUR HONOR HAS
AN INSTRUCTION, AND THIS COVERS THE SAME MATERIAL AND WE'RE
AGREED THAT YOU -- THAT THE INSTRUCTION MAY BE APPROPRIATE EVEN
BEFORE THE INTERROGATORY.
THE COURT:
MR. MCELHINNY:
THE COURT:
AT THIS TIME?
YES, YOUR HONOR.
OKAY.
EVIDENCE THAT A PARTY IS
INDEMNIFIED IS NOT ADMISSIBLE TO PROVE THAT THE PARTY IS
LIABLE, BUT IS ADMISSIBLE FOR ANOTHER PURPOSE, SUCH AS PROVING
10
A WITNESS'S BIAS.
11
OKAY.
12
GO AHEAD, PLEASE.
13
TIME IS 1:58.
MR. MCELHINNY:
AT THIS POINT, I'M GOING TO READ
14
SAMSUNG'S SWORN ANSWER TO APPLE'S INTERROGATORY -- APPLE'S
15
INTERROGATORY, THIRD SET OF INTERROGATORIES, ANSWER NUMBER 32.
16
THE DATE OF THIS ANSWER WAS SEPTEMBER 24, 2012.
17
QUESTION:
"TO THE EXTENT SAMSUNG CLAIMS TO BE INDEMNIFIED
18
OR OTHERWISE COMPENSATED IN CONNECTION WITH THIS LAWSUIT BY ANY
19
THIRD PARTY, IDENTIFY THAT THIRD PARTY, STATE THE FULL BASIS
20
FOR THE ALLEGED INDEMNIFICATION, AND DESCRIBE THE SCOPE OF THE
21
ALLEGED INDEMNIFICATION."
22
AFTER AN OBJECTION, THE ANSWER IS:
"SUBJECT TO AND
23
WITHOUT WAIVING THE FOREGOING GENERAL AND SPECIFIC OBJECTIONS,
24
SAMSUNG RESPONDS AS FOLLOWS:
25
INDEMNIFICATION FROM ANY THIRD PARTY."
SAMSUNG IS NOT CURRENTLY SEEKING
.5A8(-$%!6D!##)&#!312
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AGAIN, DATED SEPTEMBER 24TH, 2012.
THE COURT:
MR. MCELHINNY:
4
5
6
7
8
AT THIS POINT, YOUR HONOR, WE WOULD
LIKE TO PLAY THE DEPOSITION CLIP OF A MR. JAMES MACCOUN.

MR. MACCOUN, AT THE TIME OF HIS DEPOSITION, WAS A PATENT
COUNSEL AT GOOGLE.
(THE VIDEOTAPED DEPOSITION OF JAMES MACCOUN WAS PLAYED IN
OPEN COURT OFF THE RECORD.)
9
10
ALL RIGHT.
MR. MCELHINNY:
AT THIS POINT, YOUR HONOR, I WOULD
LIKE TO LODGE PLAINTIFF'S EXHIBIT 3010 AS A DEPOSITION CLIP.
11
THE COURT:
12
MR. MCELHINNY:
ALL RIGHT.
THAT'S LODGED.
AND I WOULD LIKE TO MOVE THE
13
ADMISSION OF PX 227, PX 228, AND PX 229, ALL OF WHICH ARE
14
SEALED EITHER IN THEIR ENTIRETY OR IN PART AT SAMSUNG'S
15
REQUEST.
16
MS. MAROULIS:
17
THE COURT:
18
19
NO FURTHER OBJECTION, YOUR HONOR.
OKAY.
(PLAINTIFF'S EXHIBITS 227, 228, AND 229 WERE ADMITTED IN

EVIDENCE.)
20
THE COURT:
21
MR. MCELHINNY:
22
THE COURT:
23
THOSE WILL BE ADMITTED.
AND I'LL CLARIFY THE SEALING LATER.

ALL RIGHT.
THE TIME IS 2:16.
DO YOU NEED A MINUTE TO GET YOUR NEXT WITNESS READY?
24
MS. KREVANS:
25
THE COURT:
WE DO, YOUR HONOR.
OKAY.
ACTUALLY, IT'S 2:16.
PERHAPS WE
EXHIBIT 4
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SAN JOSE DIVISION
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CORPORATION,
7
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12
13
PLAINTIFF,
VS.
DEFENDANTS.
)
)
)
)
)
)
)
)
)
)
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)
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)
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C-12-00630 LHK
APRIL 29, 2014
VOLUME 14
PAGES 3194-3369
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2
FOR PLAINTIFF
APPLE:
4
5
MORRISON & FOERSTER

RACHEL KREVANS
425 MARKET STREET
94105
6
7

HALE AND DORR
BY: WILLIAM F. LEE
60 STATE STREET
8
9
10
BY: MARK D. SELWYN

950 PAGE MILL ROAD
11
94304
12
13
15

BY: JOHN B. QUINN
WILLIAM PRICE
16
BY:
14
17
18
FOR SAMSUNG:
KEVIN B . JOHNSON
SUITE 560
19
20
21
22
23
24
25
94065
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INDEX OF PROCEEDINGS
3
4
CLOSING ARGUMENT BY MR. MCELHINNY
P. 3198
CLOSING ARGUMENT BY MR. PRICE
P. 3255
CLOSING ARGUMENT BY MR. NELSON
P. 3273
CLOSING ARGUMENT BY MR. JOHNSON
P. 3313
CLOSING ARGUMENT BY MR. QUINN
P. 3322
REBUTTAL CLOSING ARGUMENT BY MR. LEE
P. 3344
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APRIL 29, 2014

P R O C E E D I N G S
THE COURT:
MR. MCELHINNY:
MR. PRICE:
10
GOOD MORNING, YOUR HONOR.
GOOD MORNING.
8
9
GOOD MORNING AND WELCOME.
THE COURT:
GOOD MORNING, WELCOME.
PLEASE TAKE A
SEAT.
YOU HAVE NOW HEARD ALL THE EVIDENCE AND YESTERDAY YOU
11
HEARD THE LAW.
12
COUNSEL.
13
EVIDENCE AND ARGUE TO YOU WHAT HE OR SHE BELIEVES THAT EVIDENCE
14
HAS SHOWN.
15
IT'S NOW TIME TO HEAR THE CLOSING ARGUMENTS OF
EACH COUNSEL WILL HAVE AN OPPORTUNITY TO REVIEW THE
I AGAIN REMIND YOU THAT WHAT THE ATTORNEYS SAY DURING
16
THEIR ARGUMENTS IS NOT EVIDENCE.
17
EVIDENCE OR THE LAW, YOU ARE TO RELY ON YOUR OWN RECOLLECTION
18
OF THE EVIDENCE AND ON THE JURY INSTRUCTIONS THAT I HAVE
19
PROVIDED TO YOU.
20
IF ANY ATTORNEY MISSTATES THE
THE SEQUENCE OF THE CLOSING ARGUMENTS WILL BE AS FOLLOWS:
21
APPLE WILL GIVE THE FIRST CLOSING ARGUMENT ON ITS AFFIRMATIVE
22
CASE AGAINST SAMSUNG; SAMSUNG WILL THEN GIVE ITS CLOSING
23
ARGUMENT ON ITS DEFENSIVE CASE AGAINST APPLE'S AFFIRMATIVE
24
CASE, AS WELL AS ON SAMSUNG'S AFFIRMATIVE CASE AGAINST APPLE;
25
APPLE WILL THEN GIVE A CLOSING ARGUMENT ON ITS DEFENSIVE CASE
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MCELHINNY
CLOSING
1
AGAINST SAMSUNG'S AFFIRMATIVE CASE.
SO UPON THE CONCLUSION OF THESE ARGUMENTS, YOU WILL BEGIN
DELIBERATIONS IN THE JURY ROOM.
NOT TO DISCUSS THE CASE UNTIL ALL EIGHT JURORS ARE PRESENT IN
THE JURY ROOM.
6
7
8
9
10
11
12
13
PLEASE REMEMBER THAT YOU ARE
SO WITH THAT, I'M GOING TO INVITE APPLE'S COUNSEL TO COME

UP.
TIME IS NOW 9:10.
GO AHEAD, PLEASE.
MR. MCELHINNY:
THANK YOU.
MAY IT PLEASE THE COURT.
(MR. MCELHINNY GAVE HIS CLOSING ARGUMENT ON BEHALF OF THE

PLAINTIFF.)
MR. MCELHINNY:
LADIES AND GENTLEMEN OF THE JURY,
GOOD MORNING.
14
JURORS:
GOOD MORNING.
15
MR. MCELHINNY:
LET'S REMEMBER HOW WE GOT HERE.
IN
16
JANUARY OF 2007, APPLE INTRODUCED THE IPHONE, A MULTITOUCH,
17
TOUCHSCREEN DEVICE THAT COMBINED A MUSIC PLAYER AND AN INTERNET
18
BROWSER AND A TELEPHONE.
19
THAT PRODUCT, AND THE NEW FEATURES THAT MADE IT
20
ACCESSIBLE, FUN, AND EASY TO USE, WERE REVOLUTIONARY.
21
I'M GOING TO TAKE A MINUTE HERE AND EXPLAIN A LITTLE BIT
22
ABOUT THE PROCESS.
23
AND THE LAWYERS HAVE BROUGHT YOU PAGES AND THEY PUT SLIDES ON
24
THE SCREEN.
25
UP UNTIL NOW, YOU'VE SAT THERE PATIENTLY
THAT WONDERFUL WORLD IS GOING TO CHANGE THIS AFTERNOON AND
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CLOSING
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YOU'RE GOING TO GET LOCKED IN THIS LITTLE ROOM AND THEY'RE
GOING TO BRING IN ALL OF THESE TRAYS OF EXHIBITS AND THEY'RE IN
WHITE BINDERS.
THEM, BUT THE PAGES AREN'T MARKED, THEY'RE NOT HIGHLIGHTED.
YOU'RE GOING TO HAVE TO FIND THOSE EXHIBITS YOURSELF.
AND THE EXHIBITS ALL HAVE EXHIBIT NUMBERS ON
SO WHAT I'M GOING TO DO -- MANY OF THE SLIDES THAT YOU'VE
SEEN ARE NOT GOING TO BE IN EVIDENCE, SO YOU WON'T FIND THOSE.
YOU WILL JUST FIND THE EXHIBITS.
SO WHAT I'M GOING TO DO AS I WALK THROUGH THIS THIS
10
MORNING IS I'M GOING TO CALL OUT EXHIBIT NUMBERS, AND IF THAT'S
11
HELPFUL TO YOU, YOU CAN TAKE THOSE EXHIBIT NUMBERS DOWN AND
12
YOU'LL BE ABLE TO FIND -- IF YOU'RE INTERESTED IN THESE
13
DOCUMENTS, YOU'LL BE ABLE TO FIND THAT DOCUMENT WHEN YOU LOOK
14
IN THE BINDERS LATER THIS AFTERNOON.
15
THIS DOCUMENT IS EXHIBIT 145.
WE CALL IT THE GRAVITY TANK
16
DOCUMENT.
17
REMEMBER, BY SAMSUNG'S CONSULTANTS ANALYZING THE EFFECT OF THE
18
IPHONE, AND THEY CALLED IT REVOLUTIONARY.
19
THIS WAS A DOCUMENT THAT WAS PREPARED, YOU'LL
THE IPHONE LITERALLY CREATED A NEW SMARTPHONE MARKET.
20
TOOK THE WORLD BY STORM.
21
SUCCESSFUL PRODUCTS EVER IN THE FIELD OF ELECTRONICS, AND IT
22
WAS THE MOST SUCCESSFUL UNTIL THE INTRODUCTION OF THE IPAD
23
THREE YEARS LATER IN 2010, AN ENTIRELY NEW AND REVOLUTIONARY
24
PRODUCT.
25
APPLE CREATED ONE OF THE MOST
THESE PRODUCTS WERE CREATED BY TRUE GENIUSES, LIKE
IT
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CLOSING
1
STEVE JOBS, AND LIKE THE APPLE INVENTORS WHO CAME HERE TO
TESTIFY BEFORE YOU.
SEEMS SO LONG AGO -- LIKE GREG CHRISTIE WHO CAME HERE AND
TESTIFIED ON BEHALF OF THE IPHONE, ORIGINAL IPHONE TEAM.
PEOPLE, IF YOU CAN REMEMBER BACK NOW -- IT
TIM MILLET, THOMAS DENIAU WHO CAME FROM PARIS WITH HIS
FRENCH ACCENT, AND ROBERTO GARCIA.
PEOPLE WHO, THROUGH GENIUS AND HARD WORK, HAVE MADE REAL
CONTRIBUTIONS TO THE WAY PEOPLE COMMUNICATE WITH EACH OTHER AND
SHARE INFORMATION.
10
11
12
THEY WERE, AND ARE, REAL
THEY CAME HERE TO THIS COURTROOM.
THEY FACED
CROSS-EXAMINATION AND THEY TESTIFIED BEFORE YOU.

AND AS YOU ALSO KNOW, THEIR INVENTIONS ARE PROTECTED BY
13
PATENTS THAT WERE ISSUED BY THE U.S. PATENT AND TRADEMARK
14
OFFICE.
15
WE SAW THAT MR. JOBS EXPRESSLY WARNED WOULD-BE COMPETITORS
16
THAT APPLE WAS SEEKING PATENT PROTECTION FOR ITS INVENTIONS, TO
17
PUT THOSE COMPETITORS ON NOTICE THAT THEY COULD NOT SIMPLY COPY
18
APPLE'S NOVEL FEATURES AND DESIGNS.
19
20
21
THAT PART IS HISTORY.
IT IS UNCONTROVERTED.
OF IT HAS BEEN CHALLENGED IN THIS TRIAL.

WE ARE HERE BECAUSE OF A SERIES OF DECISIONS BY SAMSUNG
22
ELECTRONICS.
23
HAVE A TOUCHSCREEN SMARTPHONE.
24
25
NOT A WORD
WE KNOW THAT IN JUNE 2007, SAMSUNG DID NOT EVEN

IT WASN'T EVEN WORKING ON THAT.
INSTEAD, IT SPECIALIZED IN LESS COMPLICATED FEATURE

PHONES.
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1
WE ALSO KNOW THAT AT THAT TIME SAMSUNG WAS NOT
PARTICULARLY SUCCESSFUL.
OF THE PHONES IN THE UNITED STATES MARKETPLACE.
LEADER, AND IT WAS NOT MAKING PROGRESS.
IT WAS ONLY SELLING ABOUT 5 PERCENT
AND THEN WE SHOWED YOU EXHIBIT 149.
IT WAS NOT A
WE KNOW THAT SAMSUNG
BROUGHT ALL OF ITS EXECUTIVES TOGETHER FOR A CRITICAL MEETING
IN FEBRUARY 2010 WHEN ITS TOP EXECUTIVE MADE CLEAR THAT SAMSUNG
WAS SUFFERING WHAT THEY CALLED A CRISIS OF DESIGN AND THAT ITS
MOST SOPHISTICATED CUSTOMERS, THE AMERICAN PHONE COMPANIES,
10
WERE TELLING SAMSUNG THAT THE ONLY WAY FORWARD FOR IT WAS TO,
11
QUOTE -- THIS IS THEIR WORDS -- TO "MAKE SOMETHING LIKE THE
12
IPHONE."
13
AND WE KNOW THAT THIS WAS FOLLOWED BY MONTH AFTER MONTH OF
14
FRENZIED ACTIVITY AT SAMSUNG WHEN SAMSUNG DESIGNERS CHANGED
15
PHONE AFTER PHONE THAT WAS UNDER DEVELOPMENT TO COPY FEATURE
16
AFTER FEATURE AFTER FEATURE FROM THE IPHONE, AND THAT SAMSUNG
17
BEGAN TO SELL THESE INFRINGING PRODUCTS IN THE UNITED STATES.
18
WE KNOW THAT THAT LED TO A SECOND CRISIS, AND IN
19
AUGUST 2010, THERE WAS A MEETING BETWEEN SAMSUNG AND APPLE AND
20
AT THAT TIME, AS YOU HEARD, APPLE WAS ACTUALLY SAMSUNG'S
21
LARGEST COMPETITOR -- CUSTOMER BECAUSE SAMSUNG -- APPLE BOUGHT
22
ITS COMPONENTS, ITS PARTS FROM SAMSUNG.
23
AND THEY HAD THIS MEETING, AND AT THE MEETING, APPLE
24
ACCUSED SAMSUNG OF COPYING AND ACCUSED SAMSUNG OF INFRINGING
25
APPLE PATENTS AND DID EVERYTHING IT COULD DO TO CONVINCE
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2
SAMSUNG TO COMPETE FAIRLY INSTEAD OF UNFAIRLY.

BUT WE KNOW THAT SAMSUNG REJECTED THAT REQUEST AND
CONTINUED TO RELEASE VERSION AFTER VERSION OF INFRINGING PHONES
AND TABLETS, INCLUDING THE MORE THAN 37 MILLION DEVICES THAT
ARE AT ISSUE IN THIS CASE.
AND UNLIKE IN FAIRY TALES, WE KNOW THAT SAMSUNG'S ILLEGAL
STRATEGY HAS BEEN WILDLY SUCCESSFUL.
DRIVEN EVERY OTHER COMPETITOR, INCLUDING ALMOST EVERY OTHER
ANDROID COMPETITOR, ALMOST ENTIRELY OUT OF THE MARKET.
10
YOU HEARD THAT THEY HAVE
THE ONLY PRODUCTS THAT ARE SELLING TODAY ARE APPLE
11
PRODUCTS AND SAMSUNG PRODUCTS THAT INFRINGE APPLE PATENTS.
12
IS LITERALLY A TWO HORSE RACE.
13
IT
AND, FINALLY, WE KNOW THAT SAMSUNG'S STRATEGY HAS UNFAIRLY
14
INJURED APPLE, THE COMPANY AND THE EMPLOYEES WHO WERE THE
15
SOURCE OF ALL THIS CREATIVITY.
16
THAT IS HOW WE CAME TO THIS PLACE.
17
AND SO NOW IT IS TIME FOR YOU, A JURY CHOSEN BY LOT TO
18
REPRESENT THIS COMMUNITY, TO DO JUSTICE, TO ASSEMBLE THE FACTS,
19
TO APPLY THE LAW TO THOSE FACTS, AND TO AWARD WHATEVER DAMAGES
20
THAT YOU FIND ARE APPROPRIATE.
21
THAT'S WHY WE'RE HERE.
FOUR SHORT WEEKS AGO I STOOD BEFORE YOU AND I TOLD YOU TWO
22
THINGS THAT I WOULD LIKE TO REPEAT THIS MORNING.
23
YOU THAT THERE WERE PROBLEMS WITH LAWSUITS.
IT'S NOT EASY TO
24
BE A JUROR IN A CASE AS COMPLICATED AS THIS.
THE TESTIMONY
25
COMES IN ONE WITNESS AT A TIME, YOU SEE ONLY BITS AND PIECES OF
FIRST, I TOLD
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DOCUMENTS ON THE SCREEN, AND YOU DON'T EVEN FIND OUT THE LEGAL
PRINCIPLES UNTIL THE LAST DAY OF THE TRIAL.
AND WE GREATLY APPRECIATE YOUR WILLINGNESS TO UNDERTAKE THAT
TASK.
IT IS DIFFICULT
I ALSO TOLD YOU THAT ON THE APPLE SIDE, WE FELT IT WAS OUR
JOB TO DO WHAT WE COULD DO TO HELP YOU WITH YOUR JOB.
OUR JOB TO PRESENT THE EVIDENCE IN A CLEAR AND HELPFUL WAY, AND
IT IS BILL LEE'S AND MY JOB THIS MORNING TO TRY TO BRING THAT
EVIDENCE TOGETHER IN A WAY THAT WE HOPE WILL BE USEFUL TO YOU
10
11
IT WAS
WHEN YOU BEGIN YOUR DELIBERATIONS.

TO DO THAT, I'M GOING TO USE THE VERDICT FORM AND THE
12
INSTRUCTIONS THAT JUDGE KOH READ TO YOU YESTERDAY.
THE VERDICT
13
FORM CONTAINS ALL THE QUESTIONS YOU WILL BE ASKED TO ANSWER.
14
THE JURY INSTRUCTIONS TELL YOU HOW TO GO ABOUT ANSWERING THOSE
15
QUESTIONS.
16
CRITICALLY, THE INSTRUCTIONS HELP YOU DECIDE WHICH OF THE
17
EVIDENCE YOU HAVE SEEN IS RELEVANT TO THE QUESTIONS YOU HAVE TO
18
DECIDE AND WHICH OF THE EVIDENCE YOU HAVE SEEN HAS BEEN AN
19
ATTEMPT TO CONFUSE, TO MAKE YOUR JOB MORE DIFFICULT AND YOUR
20
ANSWERS LESS ACCURATE.
21
THE FIRST THING I WANT TO MAKE CLEAR IS WHO THE PARTIES
22
ARE TO THIS CASE.
23
FIRST PART OF THE CASE.
24
WE BROUGHT IN FRONT OF YOU, AND IT OWNS THOSE FIVE PATENTS.
25
OBVIOUSLY APPLE IS THE PLAINTIFF IN THE

APPLE INVENTED THE FIVE PATENTS THAT
THE FIRST DEFENDANT IN OUR CASE IS SAMSUNG ELECTRONICS
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CORPORATION, OR SEC.
SUWON, SOUTH KOREA.
ELECTRONICS AMERICA AND SAMSUNG TELECOMMUNICATIONS AMERICA.
4
5
6
AND AS YOU HEARD, SEC IS LOCATED IN

SEC OWNS THE OTHER TWO DEFENDANTS, SAMSUNG
SEC MANUFACTURES PHONES AND TABLETS AND SELLS THEM

DIRECTLY TO ITS SUBSIDIARIES IN THE UNITED STATES.
SEC DECIDES WHAT SOFTWARE IS GOING TO BE INSTALLED IN THE
PHONES IT SELLS IN THE UNITED STATES.
USE THE ANDROID OPERATING SYSTEM.
THE SUBSIDIARIES SELL THE ACCUSED PRODUCTS IN THE
10
11
IT WAS SEC THAT CHOSE TO
SEC SETS THE PRICES AT WHICH
UNITED STATES.
AND AS YOU MAY REMEMBER WHEN JUSTIN DENISON TESTIFIED, HE
12
TESTIFIED THAT ALL OF THE EMPLOYEES OF ALL THE SAMSUNG
13
COMPANIES SEE THEMSELVES AS PART OF SEC.
14
SOMEWHAT STRANGELY, NO EXECUTIVE FROM SEC TESTIFIED AT
15
THIS TRIAL.
16
SEC MADE, TO TELL YOU WHY THOSE DECISIONS WERE MADE, OR TO
17
DEFEND THEMSELVES IN ANY WAY AGAINST THE SERIOUS ACCUSATIONS
18
THAT YOU HAVE BEFORE YOU.
19
COME HERE AND FACE CROSS-EXAMINATION.
20
NO ONE CAME TO EXPLAIN TO YOU THE DECISIONS THAT
NONE OF THEM WERE BRAVE ENOUGH TO
SAMSUNG ELECTRONICS OF AMERICA, WHO WE CALL SEA, IS A U.S.
21
CORPORATION HEADQUARTERED IN NEW JERSEY.
SEA SELLS THE TABLETS
22
ACCUSED IN THIS CASE DIRECTLY TO CARRIERS, STORES, AND
23
CONSUMERS IN THE UNITED STATES.
24
NO SEA EMPLOYEE TESTIFIED AT THIS TRIAL.
25
FINALLY, SAMSUNG TELECOMMUNICATIONS OF AMERICA, STA, SELLS
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SAMSUNG SMARTPHONES TO CARRIERS, STORES, AND CONSUMERS IN THE
UNITED STATES.
STA IS HEADQUARTERED IN TEXAS.
WITH THE EXCEPTION OF ONE DESIGNER, EVERY SAMSUNG WITNESS
IN THIS CASE, MR. SOHN, THE FORMER CEO, MR. PENDLETON,
MR. DENISON, MR. SHEPPARD, AND MR. DICARLO WORKS OR WORKED FOR
STA DURING THE RELEVANT TIME PERIODS, AND ALL OF THESE GUYS
WERE MARKETING PEOPLE.
PERSON WHO COULD TALK ABOUT HOW THE INFRINGING PHONES CAME TO
BE.
10
11
12
13
14
15
16
17
NOT ONE SOFTWARE ENGINEER.
NOW I WANT TO TALK ABOUT THE PATENTS.
NOT ONE
FOR EACH OF THE
FIVE PATENTS IN THIS CASE, YOU WILL BE ASKED THREE QUESTIONS.

THE FIRST QUESTION IS, DID ANY OF THE THREE SAMSUNG
COMPANIES INFRINGE THE PATENT?
THE SECOND QUESTION IS, IF THERE WAS INFRINGEMENT, WAS
THAT INFRINGEMENT WILLFUL?
AND, THIRD, DID SAMSUNG PROVE, BY CLEAR AND CONVINCING
EVIDENCE, THAT THE PATENT IS INVALID?
18
IF YOU FIND THAT THE PATENT WAS INFRINGED, YOU WILL BE
19
ASKED -- THAT A VALID PATENT WAS INFRINGED, YOU WILL THEN BE
20
ASKED TO AWARD DAMAGES, BUT I'M GOING TO DEAL WITH DAMAGES
21
SEPARATELY.
22
23
24
25
LET'S START WITH THE '721 PATENT.
WE ARE ASSERTING, AS
YOU RECALL, CLAIM 8 OF THAT PATENT.

YOU WILL REMEMBER THAT PROFESSOR COCKBURN CAREFULLY WALKED
US THROUGH THE ELEMENTS OF CLAIM 8 AND TESTIFIED THAT SIX
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SAMSUNG PHONES, WHICH HE DIVIDED INTO FOUR FAMILIES, INFRINGED
THE '721 PATENT.
YOU CAN SEE THE FOUR FAMILIES ON THIS SLIDE.
LET'S BE CLEAR.
5
6
YOU HEARD NO DEFENSE FROM SAMSUNG TO FIVE
OF THESE SIX PHONES.

SAMSUNG'S EXPERT ON THE SLIDE TO UNLOCK WAS
PROFESSOR GREENBERG AND HE ONLY DEFENDED ONE PHONE, THE GALAXY
NEXUS.
9
10
FOR THE OTHER FIVE, HE PRESENTED NO DEFENSE.

I WANT TO POINT OUT ONE THING VERY SPECIFICALLY.
FOUR
11
WEEKS AGO IN HIS OPENING, SAMSUNG'S COUNSEL TOLD YOU THAT
12
SAMSUNG'S PUZZLE PIECE DESIGN, WHICH YOU SEE HERE ON THE
13
STRATOSPHERE PHONE, DID NOT INFRINGE.
14
VIDEO CLIP.
15
HE EVEN SHOWED YOU A
BUT NO SAMSUNG WITNESS BACKED THAT UP.
16
PROFESSOR GREENBERG DID NOT DEFEND THE PUZZLE PIECE.
17
COULDN'T, BECAUSE THE CLAIM LANGUAGE OF THE '721 PATENT READS
18
ON IT DIRECTLY.
19
THERE IS NOTHING IN THE CLAIM LANGUAGE ABOUT MOVING ALONG
20
A TRACK.
21
IMAGE.
22
HE
THE PATENT CLAIMS REQUIRE CONTACT WITH AN UNLOCK
LET'S GO BACK AND LOOK AT THE PHONE.
THE PUZZLE PIECE IS
23
THE UNLOCK IMAGE.
THE CLAIMS REQUIRE CONTINUOUSLY MOVING THAT
24
UNLOCK IMAGE AND UNLOCKING THE DEVICE WHEN THE UNLOCK IMAGE IS
25
MOVED TO A PREDEFINED UNLOCK REGION.
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2
3
THE PREDEFINED REGION IS OBVIOUSLY THE MISSING PIECE OF

THE PUZZLE.
AND THE CLAIMS REQUIRE VISUAL CUES TO INDICATE THE
DIRECTION OF MOVEMENT OF THE UNLOCK IMAGE REQUIRED TO UNLOCK
THE DEVICE.
THE PUZZLE PIECE DOES ALL OF THAT.
SO YOU MAY ASK YOURSELF, WHY WOULD SAMSUNG'S LAWYER MAKE
AN ARGUMENT TO YOU THAT HE KNEW, THAT HE KNOWS THAT SAMSUNG HAD
NO EVIDENCE TO SUPPORT?
10
11
WAS HE TRYING TO HELP YOU TO GET TO A
CORRECT DECISION?
PROFESSOR GREENBERG DID DEFEND ONE PHONE, THE GALAXY
12
NEXUS.
13
UNLOCK IMAGE, THE GRAPHICS CHANGE.
14
HE SAID IT DIDN'T INFRINGE BECAUSE WHEN YOU TOUCH THE
BUT AS PROFESSOR COCKBURN EXPLAINED, THE PATENT CLAIM
15
LANGUAGE IS NOT LIMITED TO ANY PARTICULAR GRAPHIC DEPICTION.
16
HE SHOWED YOU THE SPECIFICATION WHICH EXPRESSLY ANTICIPATES
17
THAT ANIMATED GRAPHICS MIGHT BE USED.
18
19
SO REALLY, SAMSUNG HAS NO DEFENSE TO INFRINGEMENT ON ANY

OF THE SIX ACCUSED PHONES.
20
LET ME HELP YOU WITH SOMETHING ELSE.
21
HAVE A TON OF PHONES WITH YOU IN THE JURY ROOM.
22
TOLD YOU CAN'T PLAY GAMES WITH THEM, BUT YOU'RE GOING TO HAVE
23
THE PHONES IN THERE.
24
25
YOU ARE GOING TO
EACH ONE WILL HAVE AN EXHIBIT NUMBER ON IT.
YOU'VE BEEN
IF YOU WANT
TO FIND THE PHONE THAT DEMONSTRATES THE INFRINGING ACTIVITY FOR
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ANY OF A PARTICULAR -- FOR A PARTICULAR PATENT, YOU CAN FIND
THE RIGHT EXHIBIT NUMBER BY LOOKING AT THE CORRECT COLUMN IN
THE VERDICT FORM.
EXAMPLE, THE ADMIRE, YOU'LL SEE THE EXHIBIT NUMBER JX 28B, SO
IF YOU WANT TO TEST THE ADMIRE FOR THIS PATENT, YOU CAN LOOK AT
THAT EXHIBIT.
SO AFTER THE PHONES THAT ARE ACCUSED, FOR
TWO THINGS TO REMEMBER:
NOT ALL OF YOUR EXHIBITS INFRINGE
EVERY PATENT, SO YOU HAVE TO BE SURE THAT YOU HAVE THE RIGHT
EXAMPLE FOR THE PARTICULAR PATENT THAT YOU ARE LOOKING AT.
10
SECOND, PLEASE REMEMBER THE JUDGE'S INSTRUCTION NOT TO
11
ACCEPT SOFTWARE UPDATES SO THAT THE EXHIBITS WILL CONTINUE TO
12
BE ACCURATE.
13
14
15
16
17
THE QUESTION THEN IS, WHICH OF THE SAMSUNG COMPANIES IS

GUILTY FOR INFRINGING THIS PATENT?
AS YOU WILL SEE FROM THE INSTRUCTIONS, THERE ARE THREE
SEPARATE WAYS A COMPANY CAN COMMIT PATENT INFRINGEMENT.
THE FIRST IS CALLED DIRECT INFRINGEMENT AND IT IS DEFINED
18
IN YOUR INSTRUCTION NUMBER 24.
19
THE ACCUSED DEVICE IN THE UNITED STATES, THAT'S PATENT
20
INFRINGEMENT.
21
22
23
WHOEVER MAKES, USES, OR SELLS
INSTRUCTION NUMBER 25 PRESENTS GUIDELINES FOR DETERMINING

WHEN SALES OCCURRED IN THE UNITED STATES.
APPLYING THESE INSTRUCTIONS, WE BELIEVE THAT SEC IS LIABLE
24
FOR DIRECT INFRINGEMENT OF THE '721 PATENT BECAUSE IT SELLS ALL
25
OF THE ACCUSED PHONES TO STA AND SHIPS THEM TO STA IN THE
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2
3
UNITED STATES FOR RESALE TO CUSTOMERS.

WE BELIEVE THAT STA IS LIABLE FOR DIRECT INFRINGEMENT
BECAUSE IT SELLS THE ACCUSED SMARTPHONES IN THE UNITED STATES.
WE BELIEVE THAT WHEN YOU ADDRESS QUESTION NUMBER 4 IN THE
VERDICT FORM, YOU SHOULD FIND INFRINGEMENT BY BOTH SEC AND STA.
LET ME STOP HERE TO POINT OUT THAT DESPITE ALL THE TIMES
THAT SAMSUNG MENTIONED IT, YOU WILL NOT FIND A SINGLE QUESTION
ABOUT GOOGLE IN YOUR VERDICT FORM OR IN YOUR JURY INSTRUCTIONS.
GOOGLE IS NOT A DEFENDANT IN THIS CASE.
10
IF YOU FIND DIRECT INFRINGEMENT BY STA, YOU WILL BE ASKED
11
IN THE VERDICT FORM WHETHER OR NOT SEC -- THIS IS A LEGAL
12
TERM -- INDUCED THAT INFRINGEMENT.
13
WAY OF COMMITTING PATENT INFRINGEMENT.
14
15
16
17
18
INDUCEMENT IS A SEPARATE
INSTRUCTION 28 SETS OUT THREE ELEMENTS OF INDUCING

INFRINGEMENT.
FIRST, SEC MUST HAVE INTENTIONALLY TAKEN ACTION THAT
ACTUALLY INDUCED DIRECT INFRINGEMENT.
THIS IS WHY WE BROUGHT YOU THE EVIDENCE THAT SEC MAKES ALL
19
THE DEVICES.
20
THE AMERICAN SUBSIDIARIES REPORT BACK THEIR SALES AND
21
STRATEGIES TO HEADQUARTERS, AS YOU SAW ON THE EXHIBITS.
22
IT DESIGNS THE PHONES, IT SETS THE PRICES, AND
SECOND, SEC MUST HAVE BEEN AWARE OF THE ASSERTED PATENTS.
23
THIS IS WHY WE READ YOU UNDISPUTED FACT NUMBER 13 IN WHICH SEC
24
ADMITS THAT IT HAS KNOWN OF THESE PATENTS SINCE AT LEAST THE
25
LAWSUIT WAS FILED.
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AND, THIRD, SEC MUST HAVE KNOWN THAT THE ACTS IT WAS
CAUSING WOULD INFRINGE.
THE INSTRUCTION GOES ON TO SAY THAT
THIS KNOWLEDGE ELEMENT CAN BE SATISFIED BY WHAT THE LAW CALLS
WILLFUL BLINDNESS.
HERE WE ASK YOU TO REMEMBER THE SAMSUNG DOCUMENTS SHOWING
THAT SAMSUNG'S ADOPTION OF THE SLIDE TO UNLOCK WAS INTENTIONAL,
THAT WE ASKED THEM TO STOP THE INFRINGEMENT, THAT THEY SHOWED
UP HERE IN COURT WITH LITERALLY NO DEFENSE, AND THAT DESPITE
OUR EFFORTS, SAMSUNG CONTINUED TO SELL INFRINGING PHONES.
10
SAMSUNG CLEARLY KNEW THAT IT WAS CAUSING INFRINGEMENT.
11
WE ASK THAT AFTER YOU CONSIDER ALL THIS EVIDENCE, YOU FIND
12
THAT SEC INDUCED ITS SUBSIDIARY, STA, TO COMMIT INFRINGEMENT OF
13
THE '721 PATENT AND THAT YOU ANSWER YES TO QUESTION 5 ON YOUR
14
VERDICT FORM.
15
FINALLY, YOU WILL GET ASKED WHETHER OR NOT SEC COMMITTED
16
WHAT THE LAW CALLS CONTRIBUTORY INFRINGEMENT.
17
WAY IN WHICH A PARTY CAN INFRINGE.
18
CONTRIBUTORY INFRINGEMENT IS DEFINED IN INSTRUCTION
19
NUMBER 29 OF THE JURY INSTRUCTIONS.
20
ELEMENTS.
21
THIS IS A THIRD
AGAIN, IT HAS THREE
ONE, THAT SEC SUPPLIED AN IMPORTANT COMPONENT OF THE
22
INFRINGING PART OF THE PRODUCT.
23
THAT MADE ALL OF THE KEY DECISIONS ABOUT WHAT SOFTWARE WAS
24
PLACED ON THE INFRINGING PHONES.
25
HERE YOU KNOW THAT IT WAS SEC
TWO, THAT THE COMPONENT IS NOT A COMMON COMPONENT SUITABLE
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FOR NON-INFRINGING USE.
SPECIFICALLY DESIGNED FOR PHONES.
OBVIOUSLY ALL THIS SOFTWARE IS

IT HAS NO OTHER USE.
AND, THREE, THAT SAMSUNG SUPPLIED THE COMPONENT WITH
KNOWLEDGE OF THE PATENT AND KNOWLEDGE THAT THE COMPONENT WAS
ESPECIALLY MADE OR ADAPTED FOR USE IN AN INFRINGING MANNER.
THIS IS SIMILAR TO WHAT WE LOOKED AT BEFORE.
GIVEN
SAMSUNG'S ADMITTED KNOWLEDGE OF THE PATENT AND INTENTIONAL
COPYING OF THE PATENTED FEATURES, IT CLEARLY KNEW THAT ITS
SOFTWARE WAS DESIGNED TO INFRINGE.
10
11
AFTER YOU CONSIDER THESE FACTORS, WE ASK THAT YOU ANSWER

YES TO QUESTION NUMBER 6 ON THE VERDICT FORM.
12
AFTER YOU ANSWER THE INFRINGEMENT QUESTIONS, YOU WILL BE
13
ASKED WHETHER OR NOT SAMSUNG PROVED THAT THE '721 PATENT WAS
14
INVALID.
15
NUMBER 31, WHICH DESCRIBES THE BURDEN OF PROOF, AND INSTRUCTION
16
NUMBER 34, WHICH DESCRIBES THE TEST FOR OBVIOUSNESS.
17
THE INSTRUCTIONS YOU WILL NEED ARE INSTRUCTION
INSTRUCTION 31, SAMSUNG -- TELLS US THAT SAMSUNG HAS TO
18
PROVE INVALIDITY BY WHAT THE LAW CALLS CLEAR AND CONVINCING
19
EVIDENCE, WHICH IS A HIGHER THAN NORMAL STANDARD IN A CIVIL
20
CASE.
21
THE KEY QUESTION FOR OBVIOUSNESS IN INSTRUCTION 34 IS
22
WHETHER OR NOT THE INVENTION WOULD HAVE BEEN OBVIOUS TO A
23
PERSON OF ORDINARY SKILL IN THE FIELD AT THE TIME OF THE
24
INVENTION.
25
BUT THE INSTRUCTION SETS OUT SEVERAL IMPORTANT RULES.
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2
FIRST, YOU ARE REQUIRED TO CONSIDER WHAT WAS THE CONTENT

OF THE PRIOR ART?
WHAT WAS KNOWN BEFORE THE INVENTION?
SECOND, YOU ARE SUPPOSED TO CONSIDER WHAT THE LAW CALLS
ADDITIONAL FACTORS THAT MAY BE RELEVANT TO OBVIOUSNESS.
THINK OF THESE AS REALITY TESTS TO SEE HOW THE WORLD ACTUALLY
REACTED TO THE INVENTION AT THE TIME.
BUT MOST IMPORTANT, YOU CANNOT PROVE THAT SOMETHING IS
OBVIOUS JUST BY GOING AND FINDING BITS AND PIECES IN THE PRIOR
ART AND TRYING TO PUT THEM TOGETHER.
10
AS JUDGE KOH HAS TOLD YOU, YOU CANNOT USE HINDSIGHT.
11
IN OTHER WORDS, YOU CAN'T DO EXACTLY WHAT SAMSUNG HAS DONE
12
HERE.
13
FIND THE VARIOUS ELEMENTS IN THE PRIOR ART.
14
YOU CANNOT USE THE PATENT ITSELF AS A ROADMAP TO TRY TO
YOU KNOW FROM YOUR OWN EXPERIENCE THAT MANY TIMES WHEN YOU
15
POINT OUT SOMETHING NEW TO SOMEONE, YOU SAY, "LOOK AT THIS,
16
THIS IS A NEW IDEA," THE PERSON WILL GO, "OH, YEAH.
17
THAT'S OBVIOUS."
18
BUT WHERE WERE THEY BEFORE YOU POINTED IT OUT TO THEM?
19
IT'S ONCE YOU SEE THE IDEA THAT, ALL OF A SUDDEN, IN
20
RETROSPECT, USING HINDSIGHT, IT APPEARS OBVIOUS.
21
22
23
WELL,
WHERE WAS SAMSUNG BEFORE IT SAW THE IPHONE?

ANSWER TO THAT QUESTION.
YOU KNOW THE
THEY DIDN'T EVEN HAVE A SMARTPHONE.
PROFESSOR GREENBERG TESTIFIED THAT THE '721 PATENT WOULD
24
HAVE BEEN OBVIOUS IN LIGHT OF A PHONE MANUAL FOR A EUROPEAN
25
PHONE CALLED THE NEONODE AND AN ARTICLE BY A PERSON NAMED
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PLAISANT.
AS YOU SAW, THERE WERE HUGE PROBLEMS WITH THIS POSITION.
BOTH OF THESE REFERENCES THAT HE WAS TALKING ABOUT WERE
ACTUALLY BEFORE THE PTO EXAMINERS WHO ISSUED THE PATENT, AND
YOU CAN SEE THAT ON THE FACE OF THE PATENT WHERE THEY ARE
LISTED.
LET ME PAUSE HERE FOR A MOMENT.
YOU'RE GOING TO SEE,
THROUGHOUT ALL OF THESE PATENTS, THAT THE EXAMINERS WHO LOOKED
AT THEM WERE EXTREMELY THOROUGH.
THE PROSECUTION HISTORY,
10
WHICH IS IN EVIDENCE, IS HUNDREDS OF PAGES LONG.
11
FOR ONE OF OUR PATENTS.
12
CITED.
13
THAT'S JX 8
MANY PATENTS AND PUBLICATIONS ARE
EVEN IN A COUPLE OF CASES WHERE SAMSUNG HAS FOUND SOME
14
REFERENCE THAT MAY NOT HAVE BEEN CITED, NO SAMSUNG EXPERT HAS
15
EVER TESTIFIED TO YOU UNDER OATH THAT THIS NEW REFERENCE WAS
16
MORE RELEVANT THAN THE ART THAT THE EXAMINER ACTUALLY LOOKED
17
AT.
18
THAT'S AN IMPORTANT THING, BECAUSE IF THE EXAMINER HAS
19
LOOKED AT MORE RELEVANT ART, OTHER ART IS NOT IMPORTANT
20
ANYMORE.
21
FILLED IN HERE.
22
IMPORTANT AND THE EXAMINER NEVER SAW ANYTHING LIKE IT.
IT'S AN IMPORTANT GAP IN THE EVIDENCE THAT WAS NOT

NO ONE HAS EVER SAID THESE NEW THINGS ARE SO
23
SPECIFICALLY WITH RESPECT TO NEONODE AND PLAISANT,
24
PROFESSOR COCKBURN POINTED OUT THAT NEONODE HAS NO VISUAL CUES
25
AND NO CONTINUOUS MOVEMENT.
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THESE X'S ON THE SCREEN SHOW THAT ELEMENTS ARE MISSING.
HE POINTED OUT THAT NOT ONLY DID PLAISANT NOT FILL OUT THE
GAPS, PLAISANT ACTUALLY TAUGHT AWAY FROM USING A SLIDE IMAGE.
YOU MAY REMEMBER, HE PUT THE ARTICLE UP AND IT SAID THAT PEOPLE
WHO LOOKED AT THIS HAD MORE PROBLEMS WITH SLIDERS.
HARDER TO IMPLEMENT.
7
8
9
10
11
12
13
THEY WERE
IT WAS NOT AS GOOD.
THERE WAS NO CLEAR AND CONVINCING EVIDENCE THE '721 PATENT

IS INVALID.
SO THEN WE MOVE TO THE ADDITIONAL FACTORS TO BE CONSIDERED
UNDER INSTRUCTION -- UNDER THE INSTRUCTION.
PROFESSOR GREENBERG SAID THAT NO FACTOR, NONE OF THESE,
WEIGHED IN FAVOR OF VALIDITY.
BUT HE SIMPLY IGNORED THE EVIDENCE OF PUBLIC ACCLAIM.
HE
14
IGNORED THE APPLE AD THAT WE SHOWED YOU THAT ACTUALLY FEATURED
15
THE SLIDE TO UNLOCK FEATURE.
16
17
HE IGNORED DOCUMENT AFTER DOCUMENT SHOWING THAT SAMSUNG

INTENTIONALLY COPIED THIS FEATURE FROM THE IPHONE.
18
PLAINTIFF'S EXHIBIT 121, WHICH IS THE VICTORY PHONE,
19
PLAINTIFF'S EXHIBIT 120, WHICH IS THE BEHOLD PHONE, PLAINTIFF'S
20
EXHIBIT 219, WHICH WAS THE KEPLER PHONE, AND PLAINTIFF'S
21
EXHIBIT 157, WHICH WAS THE AMETHYST PHONE, DR. GREENBERG DIDN'T
22
MENTION THEM.
23
EVERY ONE OF THOSE SAMSUNG INTERNAL DOCUMENTS COPIES SLIDE
24
TO UNLOCK FROM THE IPHONE.
NOT ONE OF THEM SUGGESTS THAT THE
25
IDEA WAS OBVIOUS OR THAT SAMSUNG HAD IT FIRST, THAT IT'S IN THE
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GOOGLE SOFTWARE.
NONE OF THE THINGS YOU HAVE HEARD FROM
SAMSUNG IN THIS TRIAL ARE SUPPORTED BY A SINGLE PAGE OF
SAMSUNG'S OWN INTERNAL DOCUMENTS.
A VERSION OF THE STORY THAT NEVER, EVER HAPPENED.
THEY ARE TRYING TO SELL YOU
LET'S TALK ABOUT THAT FOR A MINUTE.
THIS IS A TRIAL.
I MEAN, OBVIOUSLY THE PARTIES DISAGREE.
IT'S NOT UNUSUAL FOR PARTIES TO SEE THE WORLD DIFFERENTLY AND
YOU HAVE TO DECIDE WHERE THE TRUTH IS.
BUT IN THAT REGARD, WE HAVE TRIED TO PROVE EVERY IMPORTANT
10
FACT FROM SAMSUNG'S OWN DOCUMENTS.
11
CREATED BEFORE THIS LAWSUIT EXISTED.
12
AT SAMSUNG WERE ACTUALLY THINKING AT THE TIME.
13
THOUGHT THOSE DOCUMENTS WOULD SEE THE LIGHT OF DAY.
14
THOSE DOCUMENTS WERE

THEY SHOW WHAT THE PEOPLE
THEY NEVER
ON THE OTHER HAND, EVERY POINT SAMSUNG HAS TRIED TO MAKE
15
IN THIS TRIAL IS CONTRADICTED BY ITS OWN DOCUMENTS.
16
WITNESSES SAY A; THEIR OWN DOCUMENTS SAY B.
17
IN CASE AFTER CASE.
THEIR
YOU HAVE SEEN THAT
18
BUT SOMEHOW THAT DOESN'T SEEM TO EMBARRASS THEM.
19
SO BACK TO THE FACTORS THAT ARE RELEVANT TO OBVIOUSNESS.
20
ANOTHER FACTOR IS PRAISE FROM OTHERS IN THE FIELD.
21
YOU MAY REMEMBER, IT'S BEEN A WHILE NOW, BUT WHEN WE SAW WHAT
22
SAMSUNG'S EUROPEAN DESIGNERS ACTUALLY SAID -- THIS IS SAMSUNG'S
23
DESIGNERS -- WHEN THEY SAW THE SLIDE TO UNLOCK, WHICH IS
24
EXHIBIT 119, THEY DIDN'T SAY IT WAS OBVIOUS.
25
A "CREATIVE WAY TO SOLVE USER INTERFACE COMPLEXITY."
AND
THEY SAID IT WAS
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IF YOU WEIGH THESE FACTORS, YOU WILL FIND THAT THEY
SUPPORT THE CONCLUSION THAT SLIDE TO UNLOCK WAS AN IMPORTANT
AND NOVEL INVENTION.
IF YOU AGREE, YOU WILL ANSWER QUESTION 8 IN THE VERDICT
FORM NO, SAMSUNG HAS NOT PROVEN THAT THIS CLAIM IS INVALID.
THAT WILL BRING YOU TO THE QUESTION OF WHETHER OR NOT
7
8
9
SAMSUNG'S INFRINGEMENT WAS WILLFUL.

INSTRUCTION NUMBER 30 WILL TELL YOU THAT THE TEST FOR
WILLFULNESS IS ONE OF RECKLESS DISREGARD, WHICH MEANS THAT
10
SAMSUNG ACTUALLY KNEW OR IT WAS SO OBVIOUS THAT IT SHOULD HAVE
11
KNOWN THAT ITS ACTIONS CONSTITUTED INFRINGEMENT OF A VALID AND
12
ENFORCEABLE PATENT.
13
HERE AGAIN, COPYING PLAYS A BIG PART AND YOU CAN FIND
14
WILLFULNESS IF YOU FIND THAT SAMSUNG COPIED OUR PATENTED
15
FEATURES.
16
I'M NOT GOING TO GO BACK THROUGH THE DOCUMENTS, BUT THINK
17
ABOUT THE BIG PICTURE FOR A MOMENT.
18
PATENTS, IT KNEW IT WAS FACING ITS OWN CRISIS OF DESIGN, AND IT
19
INTENTIONALLY COPIED THE IPHONE.
20
SAMSUNG KNEW ABOUT THE
WHEN IT GOT HERE TO TRIAL, IT PRESENTED NO INFRINGEMENT
21
DEFENSE FOR FIVE OF THE PRODUCTS THAT WERE ACCUSED, AND AN
22
INVALIDITY DEFENSE THAT HAD ALREADY BEEN REJECTED BY THE PTO.
23
THE FACT THAT IT ACTED WILLFULLY IS BEYOND DISPUTE.
24
IF YOU AGREE, YOU SHOULD ANSWER YES TO QUESTION NUMBER 7
25
ON THE VERDICT FORM FOR BOTH SEC AND STA, AND THAT WILL BE IT
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2
FOR THE '721 PATENT.

THE NEXT PATENT, THE '172 AUTOMATIC WORD CORRECTION PATENT
WILL BE A LOT QUICKER BECAUSE YOU DON'T GET ASKED ANY QUESTIONS
ABOUT INFRINGEMENT.
JUDGE KOH HAS ALREADY FOUND INFRINGEMENT
AS A MATTER OF LAW.
SEVEN SAMSUNG PHONES INFRINGE THE '172
PATENT.
AT PAGE 7.
8
9
YOU WILL FIND THEM LISTED IN PLAINTIFF'S EXHIBIT 222A
HERE'S AN AD FOR EXHIBIT 222A.

THIS CASE.
THERE'S A LOT OF DATA IN
THERE'S A LOT OF DAMAGES NUMBERS.
THERE'S A LOT OF
10
LISTS OF PHONES.
11
THAT WE THINK YOU WILL NEED, AND I'LL MENTION IT SEVERAL TIMES
12
TODAY, IN THIS ONE EXHIBIT, 222A, AND THAT'S WHERE YOU WILL
13
FIND ALL OF THE NUMBERS AND THE LISTS OF ACCUSED DEVICES AND
14
EVERYTHING IN ONE PLACE IF THAT'S HELPFUL TO YOU.
15
16
17
WE HAVE LISTED ALL OF OUR -- ALL THE DATA
I'M GOING TO BE SHOWING YOU SOME SLIDES, YOU WON'T HAVE

THE SLIDES, BUT YOU WILL HAVE THIS EXHIBIT 222A.
SO FOR THIS PATENT, WE CAN MOVE DIRECTLY TO VALIDITY.
18
THIS TIME IT WAS PROFESSOR WIGDOR WHO TESTIFIED THAT, IN HIS
19
VIEW, THE PTO WAS WRONG.
20
INVENTION WAS INVALID DUE TO A COMBINATION OF THE ROBINSON AND
21
XRGOMICS PATENTS.
22
PROFESSOR WIGDOR ARGUED THAT THE '172
BUT AS IT TURNED OUT, THE PTO HAD ALL THE FIGURES -- HE
23
DIDN'T MENTION THIS ON DIRECT, BUT ON CROSS-EXAMINATION, HE
24
ADMITTED THAT THE PTO HAD ALL THE FIGURES FROM THE ROBINSON
25
PATENT BEFORE IT IN ANOTHER PATENT TO AN INVENTOR CALLED LONGE.
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PROFESSOR COCKBURN POINTED OUT THAT BECAUSE ROBINSON DID
NOT SHOW THE CURRENT CHARACTER STRING IN THE TEXT BOX, IT WAS
MISSING MANY OF THE ELEMENTS IN CLAIM 18 OF THE '172 PATENT.
AND THE GAPS COULD NOT BE FILLED BY XRGOMICS BECAUSE
XRGOMICS WASN'T EVEN A SPELLING CORRECTION PATENT.
PATENT FOR WORD EXTENSION.
7
8
9
IT WAS A
IT DOES NO CORRECTION.
ABSOLUTELY NO REASON WHY PERSONS OF ORDINARY SKILL WOULD

TRY TO COMBINE THOSE TWO PATENTS.
PROFESSOR WIGDOR ALSO COMPLETELY IGNORED THE ADDITIONAL
10
FACTORS THAT ARE RELEVANT TO OBVIOUSNESS.
11
THAT SAMSUNG HAD SOLD OVER 7.5 MILLION INFRINGING PHONES AS
12
EVIDENCE OF COMMERCIAL SUCCESS.
13
HE IGNORED THE FACT
AND HE IGNORED THE INTERNAL SAMSUNG DOCUMENTS, SUCH AS
14
PLAINTIFF'S EXHIBIT 168, WHERE T-MOBILE REPORTED THAT THE
15
ALTERNATIVE THAT SAMSUNG WAS USING ON ITS DART PHONE HAD BEEN
16
TOO JARRING.
17
18
19
NOWHERE DID ANYONE EVER SUGGEST THAT THE APPLE PATENT AND
THE APPLE PATENTED FEATURE WAS OBVIOUS.
SO WHEN YOU GET TO QUESTION 8 ON THE VERDICT FORM, WE ASK
20
YOU TO CONCLUDE THAT THE PTO GOT IT RIGHT AND ANSWER NO AS TO
21
WHETHER SAMSUNG HAS PROVEN INVALIDITY OF THE '172 PATENT.
22
FINALLY, ON WILLFULNESS, WE KNOW, ONCE AGAIN, THAT SAMSUNG
23
CONTINUED TO USE THE FEATURE EVEN AFTER IT WAS AWARE OF THE
24
PATENT AND EVEN THOUGH IT HAD NO INFRINGEMENT DEFENSE.
25
THE CLASSIC DEFINITION OF WILLFULNESS.
THAT IS
SO YOU SHOULD ANSWER
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2
3
4
QUESTION NUMBER 7 YES.

THE THIRD PATENT IS APPLE'S '647 PATENT, WHICH YOU HEARD
REFERRED TO AS QUICK LINKS OR ALSO DATA DETECTORS.
APPLE IS ASSERTING CLAIM 9 AGAINST NINE ACCUSED SAMSUNG
PHONES.
THEM IN EXHIBIT 222A AT PAGE 7.
AGAIN, YOU CAN SEE THEM HERE, BUT YOU WILL ALSO FIND
WE CALLED DR. TODD MOWRY TO TESTIFY CONCERNING THIS
PATENT.
PHONE AND HE WALKED YOU THROUGH EACH OF THE CLAIM LIMITATIONS
10
11
12
13
DR. MOWRY LOOKED AT THE SOFTWARE CODE IN EVERY ACCUSED
AGAINST REPRESENTATIVE SAMSUNG PHONES.

DR. MOWRY CAREFULLY TOOK YOU THROUGH THE SAMSUNG SOFTWARE
THAT CARRIES OUT EACH OF THE CLAIMED FUNCTIONS.
SAMSUNG CALLED DR. JEFFAY AND DR. JEFFAY CONCEDED THAT THE
14
PHONES THAT DR. MOWRY LOOKED AT WERE REPRESENTATIVE OF THE
15
ACCUSED PHONES, AND THAT MOST OF THE CLAIM ELEMENTS ARE PRESENT
16
IN THE ACCUSED PHONES.
17
DR. JEFFAY, AS YOU'LL REMEMBER BECAUSE WE HEARD IT AGAIN
18
YESTERDAY, ARGUED THAT THERE WAS NO INFRINGEMENT BECAUSE IN HIS
19
OPINION, AN ANALYZER SERVER, AS THE TERM IS USED IN THE CLAIM,
20
COULD NOT BE PROGRAMMED AS A SHARED LIBRARY.
21
22
23
24
25
BASICALLY DR. JEFFAY SAYS A SHARED -- A SERVER AND A

LIBRARY ARE DIFFERENT.
WE BROUGHT DR. MOWRY BACK IN REBUTTAL TO SHOW YOU THAT
THAT WAS WRONG.
WE SHOWED YOU THE TESTIMONY OF THE INVENTOR, DR. BONHURA.
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WE SHOWED YOU THIS TESTIMONY.
BUT WE ALSO SHOWED YOU A 1996 APPLE -- 1996 APPLE INTERNAL
E-MAIL, WHICH IS DEFENDANT'S EXHIBIT DX 334, SHOWING THAT THE
APPLE INVENTORS HAD ACTUALLY BEEN CONSIDERING IMPLEMENTING THE
ANALYZER SERVER AS A SHARED LIBRARY, EXACTLY THE SAME
IMPLEMENTATION THAT SAMSUNG ENDED UP USING YEARS LATER IN ITS
INFRINGING PHONES.
8
9
10
AND THIS IS THE CRITICAL POINT:
THERE WAS MORE THAN ONE
WAY THAT A SOFTWARE DESIGNER COULD IMPLEMENT AN ANALYZER

SERVER, MORE THAN ONE WAY TO DESIGN THE SOFTWARE.
11
APPLE CONSIDERED A SHARED LIBRARY.
YOU CAN SEE THAT HERE.
12
SAMSUNG USES A SHARED LIBRARY.
13
THEY BOTH IMPLEMENT ANALYZER SERVERS.
14
BUT HERE YOU'LL SEE THAT APPLE'S INTERNAL DOCUMENTS ARE
15
COMPLETELY CONSISTENT WITH THE POSITION THAT WE'RE TAKING IN
16
THIS CASE.
17
YESTERDAY YOU'LL RECALL WE HAD TO COME BACK BECAUSE THE
18
JUDGE GAVE US ADDITIONAL DETAIL ABOUT THIS PATENT, TWO NEW
19
INSTRUCTIONS, AND SO THE EXPERTS CAME BACK TO TESTIFY ABOUT
20
THAT.
21
AND DR. JEFFAY CAME BACK AND HE CAME BACK TO RAISE TWO NEW
22
ISSUES.
23
SEPARATE FROM THE CLIENT APPLICATIONS, WHICH IS REQUIRED, A
24
SERVER ROUTINE SEPARATE FROM A CLIENT.
25
FIRST, HE CLAIMED THAT THE SHARED LIBRARY WAS NOT
FRANKLY, THAT ARGUMENT IS A SHELL GAME.
EVERYONE AGREES
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THAT THIS CODE THAT WE'RE TALKING ABOUT IS CALLED A SHARED
LIBRARY.
APPLICATION.
USE IT.
THAT'S WHY IT'S CALLED THAT.
IT ISN'T PART OF ONE
IT'S SHARED BY EVERY APPLICATION THAT NEEDS TO
AND AS DR. JEFFAY WAS FORCED TO CONCEDE ON
CROSS-EXAMINATION, THE SAME LIBRARY IS USED BY THE BROWSER
APPLICATION.
IS USED BY OTHER APPLICATIONS.
9
10
IT IS ALSO USED BY THE MESSAGING APPLICATION.
IT
IT IS NOT PART OF ANY ONE APPLICATION OR PART OF ANY ONE

CLIENT.
IT IS SEPARATE AND AVAILABLE TO ALL OF THEM.
11
AS DR. MOWRY EXPLAINED WHEN HE ACTUALLY SHOWED YOU THE
12
CODE, IT IS STANDALONE CODE THAT SITS IN A SEPARATE PLACE IN
13
MEMORY.
14
DR. JEFFAY KEPT SAYING, WELL, IT CAN'T RUN BY ITSELF.
15
BUT, FIRST, YOU'RE NOT GOING TO FIND "RUN BY ITSELF" ANY
16
PLACE IN THIS CLAIM INSTRUCTION.
17
HERE.
18
BUT SECOND, AS DR. MOWRY SAID, ALL SOFTWARE PROGRAMS WORK
19
TOGETHER.
20
PROGRAMS DON'T RUN BY THEMSELVES.
21
THAT'S NOT PART OF THE ISSUE
EVERYTHING WORKS WITH AN OPERATING SYSTEM.
THESE
THAT'S NOT THE TEST.
THE TEST IS WHETHER OR NOT THIS CODE IS SEPARATE FROM THE
22
APPLICATION, AND BECAUSE IT IS A LIBRARY, A SHARED LIBRARY, IT
23
IS SEPARATE.
24
25
IT IS USED BY ALL.
IT IS PART OF NONE.
SECOND, ON LINKING ACTIONS TO THE DETECTED STRUCTURES,

ALTHOUGH DR. JEFFAY ADMITTED THAT THE CODE IN THE PHONES
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CREATES THE REQUIRED SPECIFIED CONNECTION TO THE START
ACTIVITY, COMPUTER SUBROUTINE UNDER THE COURT'S LINKING ACTIONS
CONSTRUCTION, HE SAID THAT IT DIDN'T MEET THE CLAIM BECAUSE
START ACTIVITY DOESN'T DO ALL OF THE STEPS THAT ARE REQUIRED TO
MAKE A PHONE CALL OR SEND AN E-MAIL, WHATEVER ACTION THE USER
SELECTED.
BUT, AGAIN, LOOK AT THE CONSTRUCTION THAT THE COURT GAVE
YOU YESTERDAY FOR LINKING ACTIONS.
LINKED COMPUTER SUBROUTINE DO EVERY STEP, JUST THAT IT PERFORM
10
11
IT DOESN'T REQUIRE THAT THE
A SEQUENCE OF OPERATIONS ON THE DETECTED STRUCTURE.

AND DR. -- PROFESSOR MOWRY WALKED YOU THROUGH THE CODE AND
12
SHOWED YOU THAT THE SHARED LIBRARY CODE PERFORMED THE
13
OPERATIONS FOR BOTH THE BROWSER AND THE MESSENGER APPLICATIONS.
14
WHEN YOU GET TO QUESTION 1, WHICH COVERS DIRECT
15
INFRINGEMENT OF THE '647 PATENT, WE ASK YOU TO SAY YES AS TO
16
BOTH SEA AND STA AND TO FIND SEA LIABLE FOR INDUCED AND
17
CONTRIBUTORY INFRINGEMENT FOR THE REASONS THAT WE HAVE
18
DISCUSSED.
19
AS TO VALIDITY ON THIS PATENT, WE HAD ANOTHER ONE OF THOSE
20
WEIRD MOMENTS.
IN THE OPENING, IF YOU TOOK NOTES, YOU'LL
21
REMEMBER THAT SAMSUNG'S LAWYER SAID THAT A PRODUCT -- HE TALKED
22
ABOUT THIS PRODUCT AT GREAT LENGTH -- CALLED EMBEDDED BUTTONS
23
AND HE TALKED ABOUT HOW EMBEDDED BUTTONS HAD BEEN INVENTED AT
24
XEROX PARK AND HE PROMISED YOU THAT THEY WOULD SHOW YOU THAT
25
EMBEDDED BUTTONS INVALIDATED THE '647 PATENT.
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BUT ONCE AGAIN, THERE TURNED OUT TO BE NO EVIDENCE TO
SUPPORT WHAT HE TOLD YOU.
BUTTONS, BUT HE DID NOT RELY ON IT TO ARGUE INVALIDITY.
YESTERDAY HE DIDN'T EVEN MENTION IT AT ALL WHEN HE WENT BACK TO
THE ISSUE OF VALIDITY.
6
7
8
9
10
DR. JEFFAY MENTIONED EMBEDDED
INSTEAD, DR. JEFFAY RELIES ON A DIALLING SYSTEM CALLED

SIDEKICK, AND YOU WILL REMEMBER THAT.
BUT THERE WAS NO EVIDENCE AT ALL TO SUPPORT THE ARGUMENT
THAT SAMSUNG'S LAWYER TOLD YOU THAT THEY WERE GOING TO MAKE.
SO LET'S TALK ABOUT SIDEKICK.
AS YOU HAVE SEEN, SIDEKICK
11
WAS A VERY PRIMITIVE DIALING SYSTEM.
12
STRUCTURE, A SIMPLE PHONE NUMBER FORMAT, AND IT DID NOT OFFER A
13
MENU OF OPTIONS ONCE IT IDENTIFIED THAT STRUCTURE.
14
THOSE ARE THE VERY THINGS THAT MADE THE '647 INVENTION SO
15
HELPFUL.
16
MENU OF OPTIONS.
17
18
19
IT DETECTED ONLY A SINGLE
IT IDENTIFIED MULTIPLE STRUCTURES AND IT PROVIDED A
SIDEKICK DOES NOT PRACTICE THE INVENTION AND IT CANNOT

PROVE THAT THIS PATENT IS INVALID.
YESTERDAY DR. JEFFAY WAS FORCED TO ADMIT THAT SIDEKICK --
20
THE FIRST TIME HE WAS HERE, DR. JEFFAY ADMITTED THAT SIDEKICK
21
DIDN'T HAVE THE POP-UP MENU, IT DIDN'T PROVIDE THE, THE
22
OPTIONS.
23
YESTERDAY HE WAS ALSO REQUIRED TO ADMIT THAT IT DIDN'T
24
HAVE THE LINKING ACTION THAT WAS REQUIRED BY THE COURT'S
25
ADDITIONAL CONSTRUCTION.
YOU'D HAVE TO PUT ANOTHER X ON THIS
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SLIDE FOR THE LINKING ACTION.
WHAT YOU HAVE HERE IS AN EXPERT TELLING YOU SIMPLY THAT
ALMOST ALL OF THE CLAIM REQUIREMENTS WOULD HAVE BEEN OBVIOUS,
EVEN THOUGH THERE IS NO EVIDENCE THAT ANYONE EVER CREATED THIS
INVENTION, THAT ANYONE EVER FILLED IN THE GAPS, THAT ANYONE
EVER CREATED WHAT IT WAS THAT MAKES THIS INVENTION VALUABLE.
7
8
9
HE SIMPLY WAVED HIS HANDS OVER IT AND HE SAID THIS WOULD

HAVE BEEN OBVIOUS.
THAT CANNOT BE CLEAR AND CONVINCING EVIDENCE.
HOW CAN IT
10
BE OBVIOUS IF THE THOUSANDS OF PEOPLE WORKING IN THIS FIELD
11
NEVER THOUGHT OF IT UNTIL THE APPLE INVENTORS DID IT?
12
AND IN THIS CASE, THE ADDITIONAL FACTORS RELEVANT TO
13
OBVIOUSNESS ARE AGAIN HELPFUL.
14
INTENTIONALLY COPIED THIS FEATURE, WITH THE USEFUL POP-UP MENU,
15
DIRECTLY FROM THE IPHONE -- THAT'S IN PLAINTIFF'S EXHIBIT
16
146 -- AND THEY COPIED IT IN 2010.
17
18
19
20
21
YOU SAW THAT SAMSUNG
WHY DO YOU HAVE TO COPY IT IN 2010 IF THE IDEA WAS OBVIOUS

ALL THOSE YEARS FROM THE SIDEKICK?
SO IN QUESTION NUMBER 8, WHEN YOU ARE ASKED IF SAMSUNG
PROVED THE PATENT INVALID, YOU SHOULD ANSWER NO.
ON THE ISSUE OF WILLFULNESS, WE KNOW THAT THE '647 PATENT
22
IS ONE OF THE PATENTS THAT WAS EXPRESSLY LISTED WHEN APPLE MET
23
WITH SAMSUNG IN AUGUST 2010 AND ASKED THEM TO STOP COPYING.
24
25
BUT WE KNOW THAT INSTEAD OF STOPPING, SAMSUNG SIMPLY -- WE

SAW THIS -- CUT AND PASTE THE APPLE INVENTOR'S ORIGINAL PAPER
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INTO ITS 2011/2012 USER EXPERIENCE PLANNING DOCUMENT.
ARE EXHIBITS 106 AND 107.
THESE
AND, FINALLY, WE KNOW THAT FROM THE TESTIMONY, AFTER APPLE
FILED THIS SUIT, GOOGLE CHANGED ITS OWN ANDROID CODE TO
ELIMINATE THE POP-UP MENU.
BUT WHEN THAT HAPPENED, SAMSUNG STOPPED USING THE GOOGLE
CODE AND IT WROTE ITS OWN CODE SO THAT ITS PHONES WOULD
CONTINUE TO COPY THE APPLE PRODUCTS DOWN TO THE SMALLEST
DETAIL.
10
11
12
13
14
THAT IS WILLFUL INFRINGEMENT.
THE FOURTH PATENT IS THE '959 UNIVERSAL SEARCH PATENT.

APPLE IS ASSERTING CLAIM 25.
DR. SNOEREN SHOWED HOW EACH OF THE CLAIM ELEMENTS IS FOUND
ON THE ACCUSED SAMSUNG DEVICES.
AGAIN, SAMSUNG'S NON-INFRINGEMENT DEFENSE IS RELATIVELY
15
NARROW.
16
IT DOES NOT DENY THAT ITS PHONES SEARCH BOTH LOCALLY AND ON THE
17
INTERNET.
18
SAMSUNG DOES NOT DENY THAT IT HAS UNIVERSAL SEARCH.
INSTEAD, DR. RINARD RAISED A VERY TECHNICAL ARGUMENT TO
19
TRY TO DEFEAT INFRINGEMENT.
20
HEURISTIC ON THE SAMSUNG DEVICES DOES NOT SEARCH INFORMATION ON
21
THE INTERNET BECAUSE THERE IS ALSO A SEPARATE HEURISTIC ON
22
GOOGLE SERVERS THAT ALSO OPERATES ON GOOGLE INTERNET SEARCHES.
23
THAT WAS HIS ARGUMENT.
24
25
DR. RINARD ARGUED THAT THE GOOGLE
BUT AS DR. SNOEREN SHOWED YOU ON REBUTTAL, THAT'S NOT

REALLY A DEFENSE BECAUSE THE SAMSUNG PHONES LOCATE BOTH CURRENT
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AND HISTORICAL INTERNET RESULTS.
USER'S INTERNET HISTORY, AND THAT IS SEARCHED AS PART OF THE
UNIVERSAL SEARCH FEATURE.
THE PHONE ITSELF STORES THE
IRONICALLY, DR. SNOEREN WAS ABLE TO USE THIS DRAWING FROM
THE GOOGLE ENGINEER, BJORN BRINGERT, TO PROVE THIS POINT.
DRAWING SHOWS CLEARLY THAT THE PHONE ITSELF SEARCHES FOR
INFORMATION ON THE INTERNET.
8
9
10
11
12
13
BECAUSE THE SAMSUNG DEVICES ARE COVERED BY THE CLAIM

LANGUAGE, WE ASK THAT YOU ANSWER YES TO QUESTION NUMBER 2
CONCERNING THE '959 PATENT.
BUT THERE'S ONE ADDITIONAL POINT HERE.
UNDER THE '959
PATENT, THE ACCUSED DEVICES INCLUDE BOTH PHONES AND TABLETS.

SO IN THIS CASE, ALL THREE COMPANIES ARE DIRECT
14
INFRINGERS.
15
AND STA SELLS PHONES.
16
THE
SEC SELLS PHONES AND TABLETS; SEA SELLS TABLETS;
QUESTIONS 5 AND 6 ON THE VERDICT FORM ABOUT CONTRIBUTORY
17
INDUCEMENT CONTINUE TO BE THE SAME ANALYSIS BECAUSE IT IS SEC
18
THAT INDUCES BOTH SEA AND STA TO INFRINGE AND IT IS SEC THAT
19
CONTRIBUTES TO THEIR INFRINGEMENT.
20
WITH REGARD TO VALIDITY, SAMSUNG PRESENTED TWO ARGUMENTS.
21
THE FIRST WAS BASED ON THE SOFTWARE PROGRAM CALLED FREEWAIS SF.
22
THE SECOND WAS BASED ON A COMBINATION OF TWO PATENTS
23
24
25
CALLED SMITH AND SHOHAM.

LET ME DEAL WITH FREEWAIS SF FIRST.
I'M SURE THAT THIS
WAS PRETTY COMPLICATED WHEN THE EVIDENCE WAS GOING IN.
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IN ORDER TO UNDERSTAND WHAT SAMSUNG WAS TRYING TO DO, YOU
HAVE TO LOOK AT THE INSTRUCTIONS.
INSTRUCTION NUMBER 32, WHICH DEALS WITH ANTICIPATION, YOU ARE
SUPPOSED TO CONSIDER ONLY EVIDENCE THAT MEETS THE LEGAL
DEFINITION OF PRIOR ART.
AS YOU WILL SEE FROM
AND IN THIS CASE, IN ORDER TO BE PRIOR ART, THE ART HAD TO
BE PUBLICLY KNOWN OR PUBLICLY USED BY OTHERS IN THE
UNITED STATES BEFORE THE APPLE INVENTORS CONCEIVED OF THE
INVENTION.
10
SO THE '959 PATENT WAS FILED, YOU'LL SEE ON THE FACE, IN
11
JANUARY OF 2000.
12
IT HAD TO HAVE BEEN KNOWN OR USED IN THE U.S. AT LEAST BEFORE
13
2000.
14
SO IN ORDER FOR FREEWAIS SF TO BE PRIOR ART,
SAMSUNG -- ONE OF SAMSUNG'S PROBLEMS IS THAT THERE IS NO
15
EVIDENCE THAT ANYONE HAD EVER USED THE FREEWAIS SF PROGRAM TO
16
SEARCH LOCALLY AND ON THE INTERNET IN THE UNITED STATES BEFORE
17
THE YEAR 2000.
18
I USE THREE CARD MONTE, I USE THE SHELL GAME.
19
SAMSUNG PUT IN A BUNCH OF EVIDENCE ABOUT A U.S. COMPANY
20
CALLED WAIS, W-A-I-S, THEY EVEN BROUGHT A WITNESS TO TALK ABOUT
21
THE WAIS COMPANY, AND THE WAIS COMPANY, AN AMERICAN COMPANY,
22
MADE SOFTWARE.
23
THAT IS NOT THE SOFTWARE THAT DR. RINARD RELIED UPON.
24
AMERICAN WAIS SOFTWARE IS NOT PART OF THEIR INVALIDITY.
25
SIMPLY IN THIS CASE TO CONFUSE THIS ISSUE OF WHAT WAS IN
THE
IT'S
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2
AMERICA AND WHAT WASN'T IN AMERICA.

THE SOFTWARE THEY'RE RELYING ON IS CALLED FREEWAIS SF, AND
AS YOU WILL RECALL, SAMSUNG BROUGHT THE SOURCE CODE OVER FOR
FREEWAIS SF OVER FROM GERMANY LAST YEAR AND PAID DR. RINARD TO
SET UP HIS OWN COMPUTER SYSTEM USING OUR PATENT AS A ROADMAP.
WHAT THEY WANTED TO ARGUE TO YOU WAS THAT YOU COULD ASSUME
THAT BECAUSE DR. RINARD WAS ABLE TO DO IT LAST YEAR, SOMEONE
ELSE MUST HAVE DONE THIS MORE THAN 15 YEARS AGO.
BUT THERE IS NO EVIDENCE THAT ANYONE HAD DONE IT BEFORE
10
DR. RINARD USED OUR PATENT AS A ROADMAP.
11
CLEAR AND CONVINCING EVIDENCE.
12
13
14
THERE'S CERTAINLY NOT
SO SAMSUNG HAS LOTS OF PROBLEMS HERE.
FIRST OF ALL, THE
PATENT CLAIMS A COMPUTER READABLE MEDIUM.

SOURCE CODE, WHICH THEY BROUGHT OVER FROM GERMANY -- THIS
15
IS WHY YOU HEARD THIS TESTIMONY -- SOURCE CODE IS NOT COMPUTER
16
READABLE.
17
CANNOT BE PRIOR ART TO THIS PATENT.
18
PEOPLE READ IT.
MACHINES DON'T.
SO SOURCE CODE
YOU MAY REMEMBER THAT DR. RINARD TESTIFIED THAT ONE OF THE
19
THINGS HE HAD TO DO, HE USED THE WORD "COMPILE," HE HAD TO
20
COMPILE THE SOURCE CODE HE GOT FROM GERMANY.
21
STEP THAT TURNS SOURCE CODE, WHICH PEOPLE CAN READ, INTO
22
COMPUTER -- INTO A COMPUTER READABLE MEDIUM.
23
COMPILING IS THE
SAMSUNG KNEW THIS WAS A PROBLEM, SO IT BROUGHT DR. RINARD
24
BACK, HE WAS THEIR LAST WITNESS BEFORE YESTERDAY, SO LAST
25
FRIDAY, THEY BROUGHT HIM BACK TO TRY A LITTLE BIT MORE OF THIS
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THREE CARD MONTE.
THIS TIME, DR. RINARD TESTIFIED THAT WHAT HE -- HE WASN'T
RELYING ON THE SOFTWARE, THE SOURCE CODE, HE WAS RELYING ON THE
DISK, BECAUSE THE DISK IS A COMPUTER READABLE MEDIUM, AND SO HE
SAID "NOW I'M RELYING ON THE DISK AND NOT THE SOURCE CODE."
BUT THAT PUTS SAMSUNG BACK WHERE IT STARTED, BECAUSE THE
DISK THAT'S IN EVIDENCE GOT HERE ONLY LAST YEAR FROM GERMANY.
IT WAS NOT IN THE UNITED STATES BEFORE THE YEAR 2000.
CANNOT BE PRIOR ART.
10
THE DISK
SO TO PUT IT SIMPLY, WE DON'T THINK YOU CAN FIND CLEAR AND
11
CONVINCING EVIDENCE THAT FREEWAIS SF, THE GERMAN PROGRAM, WAS
12
EVER USED IN THE UNITED STATES FOR AN INTERNET SEARCH BEFORE
13
JANUARY OF 2000.
14
BUT THEN SAMSUNG HAS AN EVEN BIGGER PROBLEM.
WHEN IT GOT
15
THE SOURCE CODE LAST YEAR, EVEN THOUGH IT WAS USING OUR PATENT
16
AS A ROADMAP, IT FOUND OUT THAT INSTALLING FREEWAIS SF ON A
17
SINGLE COMPUTER DOES NOT MEET CLAIM 25.
18
OF HEURISTICS, YOU'LL REMEMBER YOU NEED TWO, AND THERE IS NO
19
INTERNET SEARCH -- YOU NEED THREE.
20
21
22
23
24
25
THERE IS ONLY ONE SET
SO DR. RINARD HAD TO SET IT UP ON TWO SEPARATE COMPUTERS,

ONE TO SEARCH LOCALLY AND THE OTHER TO SEARCH THE INTERNET.
BUT THEN THE CODE HE POINTED TO ON THE INTERNET HEURISTIC
WAS ON THE WRONG PLACE.
IT'S ON THE SECOND COMPUTER.
SO AFTER ALL THAT WORK THAT HE DID, WHAT DR. RINARD ENDED
UP PROVING WAS EXACTLY HOW COOL APPLE'S INVENTION IS.
IT
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PERMITS UNIVERSAL SEARCH, LOCAL AND INTERNET, USING THE SAME
DEVICE.
PATENT.
NO ONE HAD EVER DONE THAT BEFORE APPLE CREATED ITS
DR. RINARD ALSO MENTIONED THOSE OTHER TWO PATENTS, SMITH
AND SHOHAM.
TO MATCH THE CLAIMS OF THE APPLE PATENT TO THE TECHNOLOGY OF
THOSE TWO PATENTS.
8
9
HE LITERALLY JUST MENTIONED THEM.
HE NEVER TRIED
WITH RESPECT TO UNIVERSAL SEARCH, THE OTHER FACTORS ARE

ALSO SIGNIFICANT.
YOU HEARD ABOUT THIS IN THE TESTIMONY.
THIS
10
IS THE PATENT THAT SAMSUNG SAYS IT TEMPORARILY TOOK OUT OF ITS
11
PHONES BECAUSE OF THIS CASE.
12
13
14
15
16
BUT WHAT IT -- BUT WHICH IT RUSHED TO PUT BACK IN AT THE

FIRST POSSIBLE MOMENT BECAUSE ITS CUSTOMERS DEMANDED IT.
THIS IS SIGNIFICANT EVIDENCE OF PUBLIC ACCLAIM, AND ALSO
OF SAMSUNG'S WILLFUL INFRINGEMENT.
AT THE END OF THE DAY, THIS IS ANOTHER CASE WHERE THE
17
PATENT AND TRADEMARK OFFICE PERFORMED A THOROUGH EXAMINATION
18
AND CONCLUDED THAT THIS PATENT WAS VALID.
19
TOLD YOU THAT THE ART HE TESTIFIED ABOUT WAS MORE RELEVANT THAN
20
WHAT THE EXAMINER CONSIDERED.
21
AND CONVINCING EVIDENCE THAT WOULD JUSTIFY OVERTURNING THE PTO
22
DECISION.
23
ARE WE HAVING FUN?
24
(LAUGHTER.)
25
MR. MCELHINNY:
DR. RINARD NEVER
THERE IS NO COMPELLING OR CLEAR
FINALLY, THERE IS THE '414 -- I'M
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SORRY TO MARCH YOU THROUGH ALL THIS, BUT IT'S THE ONLY WAY I
CAN THINK OF TO ACTUALLY HELP YOU DO IT, SO THIS IS THE WAY
WE'VE GOT TO DO IT.
WHAT?
I DON'T WANT YOU TO BE IN THERE AND SAY,
SO HERE WE GO.
FINALLY, THERE'S THE '414 BACKGROUND SYNC PATENT.
WE HAVE
ACCUSED TEN SAMSUNG DEVICES.
ONCE AGAIN, DR. SNOEREN, USING SAMSUNG SOURCE CODE,
DEMONSTRATED THAT EVERY ELEMENT OF THE CLAIM IS FOUND IN EVERY
10
11
ACCUSED DEVICE.
SAMSUNG BROUGHT IN DR. CHASE TO RAISE A TECHNICAL DEFENSE.
12
YOU MAY REMEMBER THAT DR. CHASE TESTIFIED THAT EVEN THOUGH THE
13
SAMSUNG PHONES HAVE SIX SYNC ADAPTERS, IN HIS OPINION, FOUR OF
14
THOSE SIX SYNC ADAPTERS WERE NOT KEY -- THE CLAIM LANGUAGE IS
15
CONFIGURED TO SYNCHRONIZE BECAUSE THEY DID NOT CARRY OUT EVERY
16
STEP OF THE SYNCHRONIZATION THEMSELVES, BUT SIMPLY STARTED THE
17
PROCESS.
18
19
20
SAME ARGUMENT WE HEARD BEFORE.
IT DOESN'T DO THE WHOLE
THING, IT ONLY STARTS THE PROCESS, THEREFORE, IT DOESN'T COUNT.

ON REBUTTAL, DR. SNOEREN CAME BACK AND SHOWED YOU THE
21
SOURCE CODE WHERE THE SYNC ADAPTERS PERFORMED A ROUTINE WHICH
22
WAS CALLED ON PERFORM SYNC.
23
AND THEN HE SHOWED YOU TWO GOOGLE DOCUMENTS THAT PROVED
24
THAT IT IS DR. SNOEREN WHO WAS CORRECT ON THIS ISSUE.
25
SHOWED YOU PLAINTIFF'S EXHIBIT 172, WHICH SAYS THAT THE SYNC
WE
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2
ADAPTER HANDLES ALL OF THE SYNC PROTOCOL LOGIC.

AND WE SHOWED YOU PLAINTIFF'S EXHIBIT 102 -- THE FIRST ONE
WAS 172, THIS ONE IS 102 -- AND THIS DOCUMENT DESCRIBES HOW THE
SYNC ADAPTER IS A FEATURE THAT PROVIDES THE NECESSARY THREAD.
BASED ON THIS EVIDENCE AND DR. SNOEREN'S TESTIMONY, WE BELIEVE
WE HAVE PROVEN INFRINGEMENT.
AGAIN, IN THIS CASE, BECAUSE THE ACCUSED DEVICES ARE BOTH
TABLETS AND PHONES, IT IS ALL THREE SAMSUNG ENTITIES THAT
INFRINGE.
10
TO TRY TO PROVE THAT THIS PATENT IS INVALID, SAMSUNG
11
PRESENTED TWO PIECES OF PRIOR ART.
12
CALLED WINDOWS MOBILE.
13
MOBILE DOESN'T HAVE THE SYNC COMPONENTS THAT ARE SPECIFIC TO
14
THREE DIFFERENT DATA CLASSES AND THAT CREATE THEIR OWN THREADS.
15
16
17
18
19
THE FIRST WAS A PROGRAM
BUT AS DR. SNOEREN EXPLAINED, WINDOWS
INSTEAD, E-MAIL, CALENDAR, AND CONTACTS WERE ALL SYNCED ON

THE SAME THREAD, SLOWING THINGS DOWN FOR THE USER.
WINDOWS MOBILE IS JUST ANOTHER EXAMPLE OF WHAT THE WORLD
WAS LIKE BEFORE THE '414 PATENT WAS INVENTED.
THE SECOND PIECE OF ART WAS A COMPUTER PROGRAM CALLED
20
EVOLUTION.
21
WORKED ON SOMETHING CALLED A SUMMARY TABLE.
22
THE DATABASE THAT WAS REQUIRED BY THE CLAIM.
23
24
25
BUT AS DR. SNOEREN EXPLAINED, FOR E-MAIL, EVOLUTION

IT DID NOT HAVE
SO, AGAIN, WE THINK THAT SAMSUNG HAS FAILED TO PROVE

INVALIDITY.
TO CONFIRM THAT, AGAIN, YOU LOOK AT THE OTHER FACTORS.
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AND THEN HERE I THOUGHT THE -- SAMSUNG PUT THIS EVIDENCE IN,
AND I WONDERED, WHY WERE THEY DOING IT?
IT'S SO CLEAR TO ME.
YOU MAY REMEMBER THAT SAMSUNG SHOWED YOU THIS SLIDE.
WAS SLIDE 83.
THE 2006 GOOGLE DOCUMENT THAT DESCRIBED BACKGROUND SYNC AS A
FEATURE, IN 2006, THAT GOOGLE HOPED TO HAVE IN THE SOFTWARE
THAT THEY WERE PLANNING TO WRITE.
8
9
10
11
12
13
14
15
IT WAS A SAMSUNG EXHIBIT 327.
THIS
IT SHOWED HERE
THIS IS EXACTLY WHAT YOUR JURY INSTRUCTIONS CALLED

LONG-FELT NEED.
GOOGLE WANTED THE FEATURE IN 2006, BUT THEY
DIDN'T KNOW HOW TO DO IT.

IN FACT, THE EVIDENCE IS THAT THEY WEREN'T ABLE TO GET IT
INTO THEIR OWN SOFTWARE UNTIL TWO YEARS LATER IN 2008.
HOW COULD IT TAKE THE PEOPLE AT GOOGLE TWO YEARS IF THE
INVENTION WAS OBVIOUS?
SAMSUNG'S INFRINGEMENT WAS WILLFUL BECAUSE IT HAD KNOWN OF
16
THE PATENT, BUT IT MADE NO EFFORT WHATSOEVER TO REMOVE THE
17
FEATURES FROM THE PHONES.
18
SO THAT CONCLUDES WHAT THE LAW REFERS TO AS THE LIABILITY
19
ISSUES.
20
THROUGH 8 IN THE VERDICT FORM.
21
OR NOT ANY OF THE SAMSUNG COMPANIES IS LIABLE FOR PATENT
22
INFRINGEMENT.
23
BY THIS TIME, YOU WILL HAVE FINISHED QUESTIONS 1

YOU WILL HAVE DECIDED WHETHER
AND IF YOU FIND ANY OF THEM LIABLE, IF YOU FIND THAT AN
24
APPLE PATENT IS VALID AND INFRINGED, YOU WILL MOVE ON TO THE
25
ISSUE OF DAMAGES.
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BUT BEFORE I GO THERE, I WANT TO MENTION TWO THINGS THAT
YOU WILL NOT FIND IN THE JURY INSTRUCTIONS.
THE INSTRUCTIONS BECAUSE THEY ARE SIMPLY EFFORTS TO MISDIRECT.
THEY ARE NOT IN
THE FIRST IS THE QUESTION OF WHETHER OR NOT APPLE USES ANY
OF THE PARTICULAR CLAIMS OF THE PATENT, OR THE PATENTS, IN ITS
PRODUCTS.
IT'S NOT RELEVANT TO INFRINGEMENT OR VALIDITY.
8
9
YOU WON'T FIND THAT ANYWHERE IN THE VERDICT FORM.
THE ISSUE IN THIS CASE IS SAMSUNG'S CONDUCT, AND IT IS

SAMSUNG THAT NEEDS TO CONVINCE YOU THAT THE INVENTIONS IT HAS
10
TAKEN, THE INVENTIONS IT HAS COPIED, THE INVENTIONS IT HAS PUT
11
IN TENS OF MILLIONS OF INFRINGING PRODUCTS, THE INVENTIONS IT
12
HAS REFUSED TO STOP USING, HAVE NO VALUE.
13
THE SECOND ISSUE IS THE GOOGLE ISSUE.
AGAIN, IN HIS
14
OPENING, LAWYER -- SAMSUNG'S LAWYER SAID THIS CASE WOULD BE
15
ABOUT APPLE -- REMEMBER, HE USED THE PHRASE, EVERYONE WENT,
16
(GASP) APPLE'S WAR ON GOOGLE.
17
BUT AS YOU HAVE NOW SEEN, THERE IS NO SUCH WAR ON APPLE'S
18
PART.
19
I BET A DOLLAR THAT YOU'LL SEE IT AGAIN THIS MORNING.
20
YOU SAW AN E-MAIL THAT USED THOSE WORDS, JUST A SNIPPET.
BUT THE EXHIBIT IS DX 489.
WHEN YOU LOOK AT THE EXHIBIT,
21
YOU WILL SEE THAT IT TALKS ABOUT A COMPETITIVE WAR, MAKING
22
BETTER PRODUCTS, MAKING THE RETAIL EXPERIENCE BETTER, GETTING
23
MORE SALES.
24
SO MUCH FOR THE CONCEPT OF A HOLY WAR.
25
BUT WHAT WE DO NOW KNOW IS THAT SAMSUNG AND GOOGLE HAVE
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WORKED OUT THEIR ISSUES CONCERNING PATENT INFRINGEMENT AMONGST
THEMSELVES.
GOOGLE.
BUT ONLY THOSE TWO.
SUGGESTED.
SAMSUNG'S LAWYERS ARE PAID BY BOTH SAMSUNG AND
GOOGLE IS HELPING TO DEFEND THE '959 AND '414 PATENTS,

NOT ALL FIVE AS SAMSUNG'S COUNSEL MAY HAVE
MR. PRICE:
I OBJECT.
THE COURT:
OVERRULED.
MR. MCELHINNY:
ON --
10
NOT BE AN ISSUE FOR YOU.
11
YOUR INSTRUCTIONS.
12
THAT'S IMPROPER ARGUMENT BASED
PLEASE SIT DOWN.
AT THE END OF THE DAY, GOOGLE SHOULD

YOU WILL NOT FIND IT ANY PLACE IN
SAMSUNG MAKES, USES, AND SELLS.
THERE WAS NO CLAIM THAT
13
GOOGLE INVENTED ANY OF THESE FEATURES BEFORE APPLE DID.
14
SAMSUNG EXPERT CAME IN HERE AND SAID "I'M RELYING ON GOOGLE'S
15
WORK AS PRIOR ART."
16
NO
SO GOOGLE IS IRRELEVANT TO VALIDITY.
YOU SHOULD REACH YOUR JUDGMENT BASED ON THE EVIDENCE.
17
GOOGLE'S AND SAMSUNG'S SECRET INDEMNITY AGREEMENTS WILL TAKE
18
CARE OF THEMSELVES.
19
IF THIS GOOGLE ISSUE HAS ANY RELEVANCE AT ALL, IT IS
20
RELEVANT TO CREDIBILITY.
21
BEGINNING AND POINTED THE FINGER AT GOOGLE.
22
THAT GOOGLE IS HELPING TO PAY HIS FEES.
23
SAMSUNG'S LAWYER GOT UP AT THE

HE DIDN'T MENTION
WHEN SAMSUNG PRESENTED GOOGLE WITNESSES AS DISINTERESTED
24
THIRD PARTIES, THEY DID NOT MENTION THAT GOOGLE HAD AGREED IN A
25
CONTRACT TO HELP DEFEND THIS CASE.
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WE HAD TO BRING THAT AGREEMENT TO YOUR ATTENTION.
BUT THEN, AS YOU SAW, WHEN WE ASKED SAMSUNG, IN
SEPTEMBER 2012, IF THEY HAD SOUGHT INDEMNITY, THEY LIED TO US,
AND THEY LIED TO US UNDER OATH.
IF IT STRIKES YOU THAT PARTIES THAT LIE UNDER OATH CANNOT
BE TRUSTED, YOU WILL FIND THAT COMMON SENSE THOUGHT EXPRESSLY
SPELLED OUT FOR YOU IN JURY INSTRUCTION NUMBER 12.
8
9
10
SO NOW I'D LIKE TO TURN TO DAMAGES.
THIS IS THE HEART OF
THIS CASE.
MAKE NO MISTAKE ABOUT IT.
THERE ARE TWO WAYS THAT SAMSUNG
11
CAN WIN THIS CASE.
12
THAT THEY DO NOT INFRINGE OR IF YOU DECIDE THAT OUR PATENTS ARE
13
NOT VALID.
14
THAT CASE THEY DESERVE TO WIN.
15
OBVIOUSLY THEY WIN THE CASE IF YOU DECIDE
IF THAT'S WHAT YOU DECIDE, SAMSUNG WILL WIN, AND IN
BUT SAMSUNG WINS EVEN IF YOU DO FIND INFRINGEMENT IF YOU
16
AWARD DAMAGES AT A LEVEL THAT ENDS UP REWARDING SAMSUNG'S
17
BUSINESS STRATEGY.
18
IF SAMSUNG CAN COPY APPLE'S PRODUCTS, SELL INFRINGING
19
PRODUCTS, AND INCREASE ITS MARKET SHARE AND END UP PAYING ONLY
20
A SMALL FINE, ITS STRATEGY WILL HAVE BEEN SUCCESSFUL AND,
21
WHATEVER YOU INTENDED, SAMSUNG WILL END UP AS A BIG WINNER.
22
THIS IS EXACTLY SAMSUNG'S STRATEGY.
THAT IS WHY ITS
23
WITNESSES CALL SOFTWARE FEATURES TRIVIAL, EVEN THOUGH ITS
24
INTERNAL DOCUMENTS CALL THEM CRITICAL.
25
IT'S WHY SAMSUNG'S WITNESSES HAVE TESTIFIED THAT THE
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PATENTS ARE EASY TO DESIGN AROUND, EVEN THOUGH SAMSUNG'S
BEHAVIOR SHOWS THAT THEY RESISTED, AND IN MANY CASES, HAVE
REFUSED TO CHANGE TO SO-CALLED NON-INFRINGING ALTERNATIVES.
AND THAT IS WHY SAMSUNG'S POSITION IS THAT APPLE HAS LOST
NO LOST PROFITS AND THAT, IN A NEGOTIATION, APPLE WOULD LICENSE
ITS PATENTS FOR PENNIES ON THE DOLLAR.
7
8
9
EVERY ONE OF THOSE ARGUMENTS IS AN ARGUMENT AIMED AT

CONVINCING YOU TO LOWER THEIR DAMAGES.
SO LET'S SEE WHAT THE COURT'S INSTRUCTIONS SAY ABOUT
10
DAMAGES.
11
DAMAGES, I TOLD YOU THIS AT THE BEGINNING, LOST PROFITS AND A
12
REASONABLE ROYALTY.
13
YOU WILL FIND THAT THERE ARE TWO POSSIBLE MEASURES OF
AT A MINIMUM, IF YOU FIND INFRINGEMENT, WE ARE ENTITLED TO
14
A REASONABLE ROYALTY.
15
PROVED THEM.
16
WE RECOVER LOST PROFITS ONLY IF WE HAVE
SO LET'S LOOK FIRST AT LOST PROFITS.
THE TEST IS EASILY
17
STATED:
18
THERE WAS A REASONABLE PROBABILITY THAT APPLE WOULD HAVE MADE
19
MORE SALES IF THE INFRINGING PRODUCTS HAD NOT BEEN ON THE
20
MARKET.
21
APPLE IS ENTITLED TO LOST PROFITS IF WE PROVE THAT
LET ME STATE THAT AGAIN.
IF YOU FIND THAT ANY SAMSUNG
22
PHONE INFRINGES, YOU ASK, WHAT WOULD HAVE HAPPENED IN THE
23
MARKETPLACE IF SAMSUNG HAD TO TAKE THAT PHONE OFF THE
24
MARKETPLACE ENTIRELY SO THAT THE FEATURES COULD BE REDESIGNED?
25
IN THAT TIME THAT IT WAS OFF THE MARKET, WOULD APPLE HAVE MADE
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2
3
SOME OF THOSE SALES?

IN INSTRUCTION NUMBER 37, THE COURT WILL GIVE YOU FOUR
FACTORS THAT APPLE MUST PROVE.
FIRST, THAT THERE WAS DEMAND FOR THE PATENTED PRODUCT.
TWO, THAT THERE WERE NO ACCEPTABLE NON-INFRINGING
ALTERNATIVES AVAILABLE, OR EVEN IF THERE WERE, THE NUMBER OF
SALES THAT WOULD BE MADE DESPITE THE NON-INFRINGING
ALTERNATIVES.
9
10
11
12
13
14
THREE, THAT APPLE HAD THE CAPACITY TO MANUFACTURE AND

MARKET THE ADDITIONAL PHONES.
AND NOW YOU'RE SEEING WHY SOME OF THESE WITNESSES CAME TO
TESTIFY.
AND, FOUR, THE AMOUNT OF PROFIT THAT APPLE WOULD HAVE MADE
IN ITS LOST SALES.
15
LET'S LOOK AT THESE FACTORS A LITTLE MORE.
16
WAS THERE DEMAND IN THE MARKETPLACE?
WE KNOW THERE WAS.
17
WE KNOW THERE WAS DEMAND FOR THE APPLE PRODUCTS THAT PRACTICED
18
THE SLIDE TO UNLOCK AND DATA DETECTOR PATENTS BECAUSE YOU HAVE
19
SEEN THE SALES NUMBERS.
20
YOU ALSO SAW, I'M NOT GOING TO WASTE YOUR TIME WITH IT
21
RIGHT NOW, BUT THEY'RE IN EVIDENCE, THE DOZENS AND DOZENS OF
22
ARTICLES PRAISING APPLE'S PRODUCTS.
23
WE ALSO KNOW THAT THERE WAS DEMAND FOR THE SAMSUNG
24
PRODUCTS THAT INFRINGED THE PATENTS BECAUSE WE ALSO SAW THE
25
SAMSUNG SALES FIGURES AND HOW THEY SKYROCKETED WHEN SAMSUNG
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STARTED TO SELL PHONES THAT INCORPORATED APPLE'S INFRINGING --
APPLE'S PATENTED FEATURES.
FINALLY, WE SAW FROM SAMSUNG'S INTERNAL DOCUMENT, WHICH IS
EXHIBIT 156, THE AMERICAN PHONE MARKET WAS A TWO HORSE RACE.
IF A SALE DIDN'T GO TO SAMSUNG, IT WAS MOST LIKELY GOING TO GO
TO APPLE.
THERE WAS CLEARLY DEMAND FOR THE PRODUCTS.
THE SECOND FACTOR INVOLVES WHAT THE LAW CALLS ACCEPTABLE
NON-INFRINGING ALTERNATIVES.
WERE THERE OTHER WAYS TO
10
ACCOMPLISH THE SAME RESULTS THAT WOULD HAVE BEEN ACCEPTABLE TO
11
A CONSUMER, BUT THAT DID NOT INFRINGE APPLE'S PATENTS?
12
THE INSTRUCTION, NUMBER 37, SAYS WE CAN GET LOST PROFITS
13
EITHER IF WE PROVE THERE WERE NO ACCEPTABLE NON-INFRINGING
14
ALTERNATIVES, OR EVEN IF THERE WERE ALTERNATIVES AVAILABLE,
15
THEN WE COULD HAVE MADE ADDITIONAL SALES IN THE CASE.
16
DR. VELLTURO ADDRESSED BOTH SITUATIONS.
HE FOUND LOST
17
PROFITS WHERE THERE WERE NO NON-INFRINGING ALTERNATIVES
18
AVAILABLE.
19
PROFITS.
20
DURING THE TIME SAMSUNG WAS SEARCHING FOR A NON-INFRINGING
21
ALTERNATIVE THAT WAS ACCEPTABLE TO USERS AND CARRIERS.
22
THIS IS WHAT HE CALLED THE OFF THE MARKET LOST
THE PRODUCT ITSELF WOULD HAVE BEEN OFF THE MARKET
AND THEN DR. VELLTURO FOUND A SMALLER NUMBER OF LOST
23
PROFITS AFTER SOME HYPOTHETICAL REDESIGN PRODUCT CAME BACK ON
24
THE MARKET BECAUSE THE HYPOTHETICAL ALTERNATIVES WOULD NOT HAVE
25
BEEN EQUALLY ATTRACTIVE TO USERS AND CARRIERS.
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2
3
THE FIRST QUESTION IS, HOW LONG WOULD THE SAMSUNG PHONES
BE OFF THE MARKET WHILE THEY WERE BEING REDESIGNED?
WE ARE ONLY SEEKING OFF THE MARKET LOST PROFITS FOR THREE
PATENTS, THE '647, THE '721, AND THE '172 AND, BASED ON THE
TESTIMONY OF OUR EXPERT, DR. VELLTURO, ONLY FOR A FOUR MONTH
PERIOD.
7
8
9
10
11
WE THINK THAT'S PRETTY CONSERVATIVE.
FOR THE QUICK LINKS PATENT, WE KNOW THAT SAMSUNG HAS NEVER
BEEN ABLE TO DESIGN AROUND IT.
THEY STILL USE IT TO THIS DAY.
USING A HYPOTHETICAL FOUR MONTH PERIOD IS EXTREMELY

FAVORABLE TO THEM.
FOR THE SLIDE TO UNLOCK AND WORD CORRECTION PATENTS, BASED
12
ON DR. COCKBURN'S TESTIMONY, IT WOULD TAKE MONTHS TO DESIGN A
13
NEW INTERFACE, TO TEST IT, AND TO GET CARRIER APPROVAL.
14
SAMSUNG HAS TOLD YOU THAT IT WOULD ONLY TAKE TWO HOURS,
15
BUT THEY PRODUCED NO DOCUMENTS THAT SHOW THE NORMAL DESIGN --
16
HOW LONG THE NORMAL DESIGN PROCESS TAKES.
17
THERE REALLY IS NO EVIDENCE IN THE RECORD THAT SUPPORTS
18
ANY PERIOD SHORTER THAN FOUR MONTHS.
19
THE BEGINNING WOULDA, SHOULDA, COULDA.
20
21
22
IT'S ALL WHAT I CALLED AT
DURING THE OFF THE MARKET PERIOD, SAMSUNG SOLD MILLIONS OF

INFRINGING PHONES.
DR. VELLTURO CALCULATED THAT ONLY A FRACTION OF THOSE
23
SALES WOULD HAVE GONE TO APPLE IF THE SAMSUNG PHONES HAD BEEN
24
OFF THE MARKET -- I CAN'T SAY THE NUMBER OUT LOUD, BUT YOU CAN
25
SEE THE NUMBER OF UNITS ON THE SCREEN IN RED -- AND THAT APPLE
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LOST THOSE PROFITS.
THAT RESULTS IN OFF THE MARKET LOST
PROFITS OF ABOUT $507 MILLION.
THE SECOND ELEMENT OF THE NON-INFRINGING ALTERNATIVE
FACTOR IS WHETHER OR NOT CONSUMERS WOULD HAVE BEEN DISAPPOINTED
WITH THE HYPOTHETICAL NON-INFRINGING DESIGN THAT WOULD HAVE
REPLACED THE PATENTED FEATURES.
AGAIN, ALL THE EVIDENCE TELLS US THAT THEY WOULD BE.
FIRST, WE HAD THE REAL WORLD EVIDENCE.
WE KNOW THAT
EVENTUALLY SAMSUNG REMOVED THE SLIDE TO UNLOCK AND AUTO CORRECT
10
FEATURES, SO WE GAVE THEM FULL CREDIT FOR THAT AND WE ARE NOT
11
SEEKING DIMINISHED DEMAND LOST PROFITS FOR THOSE TWO PATENTS.
12
BUT FOR THE REMAINING THREE, WE KNOW THAT IN THE REAL
13
WORLD, SAMSUNG HAS NEVER BEEN ABLE TO DESIGN AROUND QUICK LINKS
14
OR BACKGROUND SYNC.
15
WORKED FOR THEM IN THE REAL WORLD.
16
THEY HAVE NEVER FOUND AN ALTERNATIVE THAT
AND WE KNOW THAT WITH UNIVERSAL SEARCH, WHEN THEY TOOK IT
17
OUT AS PART OF THIS CASE, THEY PUT IT BACK IN AT THEIR FIRST
18
OPPORTUNITY BECAUSE THEIR USERS DEMANDED IT.
19
SO IN THE REAL WORLD -- THE DAMAGES WORLD IS MUCH EASIER
20
FOR THEM BECAUSE IT TALKS ABOUT THIS HYPOTHETICAL WORLD.
21
IN THE REAL WORLD, THE WORLD IN WHICH SAMSUNG ACTUALLY MADE
22
DECISIONS THAT WE CAN SEE, SAMSUNG HAS NEVER FOUND A
23
SATISFACTORY ALTERNATIVE.
24
25
BUT
IT JUST KEEPS ON INFRINGING.
GIVING THEM CREDIT FOR SOME HYPOTHETICAL DESIGN AROUND

THAT NEVER HAPPENED IS EXTREMELY CONSERVATIVE.
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AND THEN WE CONFIRMED THAT CONSUMERS VALUE THESE FEATURES
OVER THE ALTERNATIVES BY CALLING ON PROFESSOR JOHN HAUSER TO DO
A CONJOINT SURVEY TO MEASURE EXACTLY HOW REAL CONSUMERS VALUE
THESE FEATURES.
ONE OF THIS COUNTRY'S ABSOLUTE EXPERTS IN THE FIELD, CONFIRMED
THAT REAL LIFE CONSUMERS FIND THESE FEATURES VALUABLE AND
PREFER THEM TO ALTERNATIVES THAT DO NOT INFRINGE.
AND THAT SURVEY, DESIGNED AND CARRIED OUT BY
USING THE SAME METHODS THAT HE HAS PERSONALLY USED DOZENS
OF TIMES AND THAT AMERICAN INDUSTRY HAS USED THOUSANDS OF TIMES
10
A YEAR FOR THE LAST FOUR DECADES, DR. HAUSER CONFIRMED WHAT IS
11
OBVIOUS, THAT THERE IS DEMAND FOR THE PATENTED FEATURES, THAT
12
CARRIERS AND CONSUMERS WANT THESE FEATURES IN THE PHONE, THAT
13
THEY HAVE AN IMPACT ON PURCHASING DECISIONS.
14
WHAT DID DR. HAUSER DO?
HE CONDUCTED A SMARTPHONE SURVEY
15
OF 507 PARTICIPANTS AND A TABLET SURVEY WITH 459 PARTICIPANTS.
16
EACH OF THESE PARTICIPANTS HAD A STRONG INCENTIVE TO
17
PARTICIPATE CONSCIENTIOUSLY IN THE SURVEY, BECAUSE YOU'LL
18
REMEMBER THEY GOT THIS POTENTIAL PRIZE SMARTPHONE OR TABLET
19
THAT INCLUDED THE FEATURES AND PRICE PREFERENCES THAT THEY HAD
20
INDICATED WITH THEIR SURVEY CHOICES.
21
THE SURVEY PARTICIPANTS WERE THEN WALKED THROUGH A SERIES
22
OF WRITTEN AND ANIMATED DESCRIPTIONS OF THE PATENTED FEATURES
23
AND ANOTHER 21 DISTRACTION FEATURES, WHICH DESCRIPTIONS THEY
24
COULD REPLAY AT ANY TIME IN THE SURVEY PROCESS, INCLUDING WHEN
25
THEY MADE THEIR SURVEY CHOICES.
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FROM THE 500 PARTICIPANTS IN THE SMARTPHONE SURVEY -- AND
LET'S BE CLEAR, THESE ARE THE PEOPLE WHO ACTUALLY DID THE
SURVEY, THEY'RE NOT THE PEOPLE IN DR. REIBSTEIN'S VIDEOS, THESE
ARE THE PEOPLE DR. HAUSER SURVEYED -- DR. HAUSER WAS ABLE TO
GATHER A RICH DATA SET REFLECTING OVER 16,000 CHOICES OR DATA
POINTS WHICH HE ANALYZED USING THE INDUSTRY GOLD STANDARD, THE
SAWTOOTH SOFTWARE, AND WHICH ESTABLISHED DEMAND FOR THE
PATENTED FEATURES IN THIS CASE.
9
10
11
DR. HAUSER VALIDATED THE RESULTS OF THIS ANALYSIS WITH

STANDARD TESTS THAT ESTABLISHED THEIR STATISTICAL RELIABILITY.
LET'S BE CLEAR.
SAMSUNG ABSOLUTELY HATES THE RESULTS OF
12
PROFESSOR HAUSER'S SURVEY BECAUSE IT SHOWS SO DRAMATICALLY THE
13
PATENTED FEATURES ARE VALUABLE.
14
15
16
THE SURVEY UNDERMINES EVERY ARGUMENT SAMSUNG NEEDS TO MAKE

IN THIS COURTROOM, SO SAMSUNG HAS DECLARED WAR ON IT.
EARLIER IN THIS CASE, AS YOU SAW, A SAMSUNG EXPERT NAMED
17
WAGNER TOLD THIS COURT THAT A CONJOINT SURVEY WAS EXACTLY THE
18
WAY TO MEASURE THE VALUE OF FEATURES AT ISSUE IN THIS CASE.
19
YOU DIDN'T SEE WAGNER IN THIS COURTROOM.
HE'S HISTORY.
20
AND YOU CERTAINLY NEVER SAW A SURVEY DONE BY SAMSUNG.
21
WHY WOULD THEY RUN A SURVEY?
THEY KNOW THAT THE FEATURES
22
ARE VALUABLE, AND THEY KNOW THAT ANY WELL DESIGNED SURVEY WOULD
23
SHOW THAT RESULT.
24
25
INSTEAD, YOU SAW A WHOLE FLOCK OF NEW EXPERTS TO NITPICK

HAUSER'S QUESTIONNAIRE, TO NITPICK THE DESIGN OF THE CHOICE
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SCREENS, AND TO OFFER THINGS LIKE EYE TRACKING TESTS AND
SENTENCE COUNTING TESTS WHICH THEY ADMITTED HAVE NEVER, EVER
PREVIOUSLY BEEN USED IN ANY SERIOUS DISCUSSION OF THE VALUE OF
PATENTS.
AND AS THEY ADMITTED, NOT ONE OF THESE PEOPLE HAS THE
EXPERTISE IN CONJOINT STUDIES TO MATCH DR. HAUSER.
THEY COULDN'T.
8
9
10
11
12
13
FRANKLY,
HE IS THE BEST.
AND HIS STUDY CONFIRMED WHAT SAMSUNG'S ACTIONS AND YOUR

COMMON SENSE TELL US IS TRUE.
THESE FEATURES HAVE VALUE.
THEY
HELP TO SELL PHONES.

IF THEY DIDN'T, SAMSUNG WOULD NEVER HAVE COPIED THEM AND
IT WOULD HAVE DROPPED THEM YEARS AGO.
BUT THAT NEVER HAPPENED.
THE SAMSUNG DECISION MAKERS, THE PEOPLE WHO DID NOT SHOW
14
UP HERE TO ANSWER OUR QUESTIONS, HAVE DECIDED THAT SAMSUNG
15
NEEDS THESE FEATURES TO CONTINUE TO BE SUCCESSFUL IN THE
16
MARKETPLACE.
17
COULD, AND THEIR ACTIONS CONFIRM PROFESSOR HAUSER'S RESULTS.
18
THAT IS THE REVEALED PREFERENCES THAT DR. VELLTURO TOLD US
19
ABOUT.
20
21
22
THEIR ACTIONS SPEAK LOUDER THAN ANY SURVEY EVER
SO FOR THE SECOND FACTOR, SAMSUNG PRODUCTS WOULD HAVE BEEN

OFF THE MARKET FOR AT LEAST FOUR MONTHS.
AND THEN IN THE HYPOTHETICAL WORLD WHERE THEY STOPPED
23
USING APPLE'S PATENTED FEATURES, THAT CHANGE WOULD HAVE
24
CONTINUED TO RESULT IN ADDITIONAL SALES OF APPLE PRODUCTS.
25
AND AS YOU SAW, DR. VELLTURO VALUED THOSE DIMINISHED
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DEMAND LOST PROFITS AT JUST UNDER $560 MILLION.
FORTUNATELY, THE NEXT TWO FACTORS ARE EASY.
APPLE'S VICE-PRESIDENT OF SUPPLY AND DEMAND MANAGEMENT,
TESTIFIED THAT APPLE HAD THE CAPACITY TO MAKE THE ADDITIONAL
PHONES AND TABLETS.
TESTIMONY.
7
8
9
10
11
RORY SEXTON,
NO SAMSUNG WITNESS DISPUTED THAT
AND SAMSUNG DID NOT DISPUTE THE PROFIT THAT APPLE MADE
FROM THE IPHONE SALES DURING THE DAMAGE PERIOD.
THE PROOF OF EACH OF THESE FOUR FACTORS IS STRONG AND IT
IS DOCUMENTED.
SAMSUNG, ON THE OTHER HAND, HAS STAKED OUT THE POSITION
12
THAT IT COULD SIMPLY HAVE DROPPED ALL THESE PATENTED FEATURES,
13
EVEN THOUGH IT NEVER HAS IN THE REAL WORLD, THAT IT COULD HAVE
14
REDESIGNED ITS PHONES IN LESS THAN A DAY, EVEN THOUGH IT NEVER
15
HAS IN THE REAL WORLD, AND THAT THE FEATURES MAKE NO DIFFERENCE
16
TO CONSUMERS.
17
IN MY OPENING.
18
WOULDA, SHOULDA, COULDA, EXACTLY AS I PREDICTED
AND EXACTLY AS I TOLD YOU SHE WOULD, SAMSUNG'S EXPERT TOLD
19
YOU THAT OUT OF THESE 37 MILLION INFRINGING SALES, APPLE DID
20
NOT LOSE ONE SALE.
21
NOT ONE.
ZERO.
IRONICALLY, AFTER ALL OF THIS DETAIL, YOU'LL FIND
22
INSTRUCTION NUMBER 39, WHICH IS ENTITLED MARKET SHARE.
23
INSTRUCTION SAYS SIMPLY THAT YOU CAN CHOOSE TO AWARD APPLE ITS
24
LOST PROFITS BY AWARDING IT ITS MARKET SHARE OF THE INFRINGING
25
DEVICES.
THIS
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IN SOME WAYS, MARKET SHARE IS THE EASIEST BECAUSE IT TELLS
US EXACTLY WHAT HAPPENED IN THE REAL WORLD.
BRAND, IT ACCOUNTS FOR ADVERTISING, IT ACCOUNTS FOR SCREEN
SIZE, ALL OF THOSE FACTORS SAMSUNG WANTED TO TALK ABOUT.
5
6
7
IT ACCOUNTS FOR
AS YOU MAY RECALL, APPLE'S MARKET SHARE DURING THIS TIME

PERIOD WAS 40 PERCENT.
BUT YOU WILL RECALL THAT DR. VELLTURO HAS BEEN
CONSERVATIVE HERE AS WELL.
HE MADE A NUMBER OF DOWNWARD
ADJUSTMENTS BECAUSE OF CARRIERS WHO WERE CARRYING THE PHONES,
10
AND INSTEAD OF 40 PERCENT, APPLE IS SEEKING JUST UNDER 10
11
PERCENT OF SAMSUNG'S INFRINGING SALES.
12
EITHER WAY YOU MEASURE IT, APPLE'S LOST PROFITS DAMAGES
13
ARE JUST OVER $1 MILLION FOR 9.5 PERCENT OF SAMSUNG'S
14
INFRINGING SALES.
15
AGAIN, THIS SLIDE COMES DIRECTLY FROM EXHIBIT 222A.
16
THE SECOND TYPE OF DAMAGES IS WHAT THE LAW CALLS A
17
REASONABLE ROYALTY.
18
SALE FOR WHICH YOU AWARD US LOST PROFITS, AND DR. VELLTURO WAS
19
CAREFUL NOT TO DOUBLE COUNT.
20
OBVIOUSLY WE DO NOT GET A ROYALTY FOR ANY
BUT AS THE JUDGE HAS TOLD YOU IN INSTRUCTION NUMBER 40, A
21
REASONABLE ROYALTY PAYMENT IS THE MINIMUM AMOUNT OF DAMAGES
22
APPLE SHOULD BE AWARDED FOR EVERY ACT OF INFRINGEMENT.
23
IN INSTRUCTION NUMBER 41, JUDGE KOH LISTS 15 FACTORS THAT
24
YOU SHOULD CONSIDER IN DETERMINING A REASONABLE ROYALTY.
25
SUBMIT TO YOU THAT EVERY ONE OF THESE FACTORS ARGUES IN FAVOR
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OF A SUBSTANTIAL ROYALTY.
LET'S LOOK AT FACTOR 8, THE PROFITABILITY OF THE PRODUCT
MADE UNDER THE PATENTS, AND ITS COMMERCIAL SUCCESS AND CURRENT
POPULARITY.
THINK BACK TO THE CHARTS WE HAVE SHOWN YOU CONCERNING THE
COMMERCIAL SUCCESS OF THE IPHONE AND THEN THE SUCCESS OF THE
INFRINGING SAMSUNG PHONES.
HAS BEEN PHENOMENALLY SUCCESSFUL.
THE IPHONE WAS A REVOLUTION.
IT
AND THE INFRINGING SAMSUNG PHONES HAVE DRIVEN VIRTUALLY
10
EVERY OTHER ANDROID PHONE MAKER OUT OF THE MARKETPLACE, MAKING
11
THE U.S. MARKET A TWO HORSE RACE.
12
IN SHORT, THE IPHONE WAS A REVOLUTIONARY PRODUCT IN A HOT
13
MARKETPLACE AND BOTH COMPANIES ARE MAKING MONEY.
14
INFRINGING PRODUCTS HAVE BEEN SO SUCCESSFUL THAT SAMSUNG HAS
15
BEEN ABLE TO SUBSTANTIALLY RAISE ITS PRICES.
16
MUCH, ON YOUR SCREEN, WHICH COMPARES SAMSUNG'S AVERAGE PRICE IN
17
2011 TO ITS AVERAGE PRICE IN 2012.
18
SUBSTANTIAL ROYALTY.
19
20
SAMSUNG'S
YOU CAN SEE HOW
FACTOR 8 CALLS FOR A
SO LET'S LOOK AT FACTOR 9, THE ADVANTAGE OF THE PATENTED

PROPERTY OVER THE OLDER DEVICES.
21
THIS IS, OF COURSE, ANOTHER PLACE WHERE SAMSUNG'S
22
DOCUMENTS AND ITS CONDUCT TELL A STORY THAT IS ENTIRELY
23
DIFFERENT THAN WHAT SAMSUNG HAS SAID IN THIS COURTROOM.
24
25
NOTHING SPEAKS MORE CLEARLY TO THIS FACTOR THAN THE CRISIS

OF DESIGN E-MAIL.
IN 2010, SAMSUNG WAS STUCK WITH OLD
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TECHNOLOGY.
IPHONE WAS THE DIFFERENCE BETWEEN HEAVEN AND EARTH.
THE DIFFERENCE BETWEEN THAT TECHNOLOGY AND THE
THE HIGHEST EXECUTIVES AT SAMSUNG HAVE SPELLED OUT FOR US
IN BLACK AND WHITE EXACTLY WHAT SAMSUNG WOULD HAVE BEEN
THINKING AT THE TIME OF THIS HYPOTHETICAL NEGOTIATION.
IN HIS OPENING, SAMSUNG'S LAWYER TOLD YOU THAT PEOPLE BUY
SAMSUNG PHONES FOR THEIR HARDWARE, NOT FOR THEIR SOFTWARE.
STOOD RIGHT HERE AND HE TOLD YOU THAT.
HE
BUT THEN YOU SAW WHAT SAMSUNG SAID IN ITS INTERNAL
10
DOCUMENTS -- EXHIBIT 147 -- WHAT THE SAMSUNG DECISION MAKERS
11
WHO DIDN'T COME HERE TO TESTIFY UNDER OATH WERE ACTUALLY
12
THINKING, AND THE TRUTH IS ENTIRELY DIFFERENT.
13
SOFTWARE IS THE NEW VALUE DRIVER.
14
THEY SAID
EVEN MR. SOHN EVENTUALLY ADMITTED ON CROSS-EXAMINATION
15
THAT SOFTWARE VALUE HAS BECOME MORE IMPORTANT IN SMARTPHONES.
16
FINALLY, THE FIRST GOOGLE WITNESS, MR. LOCKHEIMER,
17
TESTIFIED THAT BACKGROUND SYNC WAS INCREDIBLY USEFUL, THAT WAS
18
HIS WORDS, INCREDIBLY USEFUL.
19
20
AFTER THAT TESTIMONY, SAMSUNG STOPPED ASKING THE GOOGLE

WITNESSES ABOUT THE VALUE OF SOFTWARE FEATURES.
21
FACTOR 9 ARGUES IN FAVOR OF A SUBSTANTIAL ROYALTY.
22
LET'S LOOK AT FACTOR 11, THE EXTENT TO WHICH THE INFRINGER
23
HAS MADE USE OF THE INVENTION AND ANY EVIDENCE PROBATIVE OF
24
THAT VALUE.
25
YOU KNOW THIS NUMBER NOW BY HEART.
OVER 37 MILLION
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INFRINGING SALES.
PEOPLE.
YOU COULD GIVE EVERY PERSON IN SAN JOSE 37 INFRINGING
PHONES.
THE SIZE OF THIS ILLEGAL ACTIVITY IS BEYOND
COMPREHENSION.
5
6
THE POPULATION OF SAN JOSE IS 1 MILLION
THE COURT:
10:30 NOW.
I'M SORRY TO INTERRUPT YOU, BUT IT'S
LET'S GO AHEAD AND TAKE OUR BREAK.
MR. MCELHINNY:
THE COURT:
9
10
11
12
13
WE'LL TAKE A 15 MINUTE BREAK.

IN 15 MINUTES.
THE COURT:
COURTROOM.
OKAY.
THE JURORS HAVE LEFT THE
LET'S TAKE OUR BREAK NOW.
THANK YOU.
14
(RECESS FROM 10:31 A.M. UNTIL 10:45 A.M.)
15
16
THE COURT:
WELCOME BACK.
17
18
GO AHEAD, PLEASE.
19
20
21
22
23
WE'LL SEE YOU
MR. MCELHINNY:
PLEASE TAKE A SEAT.
IT'S STILL ME, BUT I WON'T BE MUCH
LONGER, SO IF YOU CAN JUST HOLD ON.

WE WERE TALKING ABOUT FACTOR 11 ON THE LIST.
WE TALKED
ABOUT 37 MILLION, OVER 37 MILLION INFRINGING SALES.

AND SO THE QUESTION IS, IS THIS USE PROBATIVE OF VALUE?
24
HERE YOU CAN RELY ON YOUR COMMON SENSE FOR WHAT DR. VELLTURO
25
CALLED REVEALED PREFERENCES.
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SAMSUNG COPIED THE INVENTIONS BECAUSE IT THOUGHT THEY WERE
CRITICAL.
BEEN ABLE TO THINK OF ANY BETTER WAY, AND IT IS FIGHTING THIS
CASE BECAUSE IT KNOWS IT NEEDS THOSE FEATURES TO CONTINUE TO
SUCCEED IN THE MARKETPLACE.
IT CONTINUES TO USE THREE OF THEM BECAUSE IT HAS NOT
JUST LIKE YOUR PARENTS TOLD YOU WHEN YOU WERE CHILDREN,
WATCH WHAT THEY DO, NOT WHAT THEY SAY IN A COURTROOM WHEN THEY
ARE WORRIED ABOUT THE CONSEQUENCES.
9
10
MAYBE IT WAS MY PARENTS WHO SAID THAT, BUT THAT'S SLIGHTLY

DIFFERENT.
OKAY.
11
FACTOR 11 CALLS FOR A SUBSTANTIAL ROYALTY.
12
AND THEN WE CAN GO BACK TO FACTOR 5.
YOU WILL SEE WHY A
13
ROYALTY AGREED UPON IN AUGUST OF 2011 WOULD HAVE BEEN
14
SIGNIFICANT.
15
WHAT WAS THE COMMERCIAL RELATIONSHIP BETWEEN APPLE AND
16
SAMSUNG IN AUGUST OF 2011?
17
APPLE HAD ASKED SAMSUNG NOT TO COPY ITS PATENTS, AND THEN BY
18
AUGUST 2011, APPLE KNEW THAT SAMSUNG HAD SIMPLY BLOWN THAT
19
REQUEST OFF.
20
YOU KNOW THAT A YEAR PREVIOUSLY,
APPLE HAD SEEN THE NEW GALAXY PHONES AND IT KNEW THAT
21
SAMSUNG WAS RIPPING OFF KEY FEATURES.
22
SAMSUNG'S COPYING WAS HELPING SAMSUNG STEAL SALES FROM APPLE.
23
APPLE KNEW THAT
SO IN AUGUST OF 2011, IF SAMSUNG HAD ASKED TO LICENSE FIVE
24
KEY SOFTWARE FEATURES, WHAT WOULD APPLE HAVE SAID?
25
HAVE SAID WHAT SAMSUNG'S WITNESSES TOLD YOU, SURE, GO AHEAD,
WOULD APPLE
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2
3
TAKE ALL FIVE FOR 1.75 A PHONE?

YOU KNOW THAT WOULD NOT HAVE HAPPENED.
YOU KNOW THAT
WOULD NOT HAVE HAPPENED.
REMEMBER THAT -- THE HIGHLIGHT FOR ME OF THE TRIAL,
REMEMBER WHEN MR. PENDLETON, THE ADVERTISING GUY FROM STA, WAS
SITTING UP THERE AND MR. LEE SURPRISED HIM BECAUSE HE'D BEEN
TALKING ABOUT S BEAM, THIS NEAR FIELD COMMUNICATION, AND
MR. LEE SAID TO HIM, WOULD SAMSUNG HAVE LICENSED S BEAM TO A
COMPETITOR FOR PENNIES ON THE DOLLAR?
10
MR. PENDLETON ALMOST FELL OUT OF HIS CHAIR.
HE ALMOST
11
SWALLOWED HIS TONGUE BECAUSE THE CONCEPT OF GIVING AWAY AN
12
IMPORTANT FEATURE WAS SO FAR FROM ANYTHING HE EVER WOULD HAVE
13
CONSIDERED IN THE REAL WORLD.
14
BY THE WAY, THAT SAME FEATURE WAS ONE THAT THE EYE
15
TRACKING EXPERT SAID HAD NO VALUE.
16
THE TESTIMONY OF THE SAMSUNG EXECUTIVE THAT YOU SAW.
17
COMPARE HER TESTIMONY TO
AUGUST 2011 WAS ALSO A CRITICAL POINT IN THE U.S. MARKET.
18
60 MILLION CONSUMERS WERE GOING TO BUY THEIR FIRST IPHONES
19
WITHIN THE NEXT 18 MONTHS.
20
YOU WHAT APPLE WOULD HAVE DONE.
21
AND, AGAIN, YOUR COMMON SENSE TELLS
TO BE HONEST, I DON'T UNDERSTAND SAMSUNG'S EVIDENCE ON
22
THIS POINT.
SAMSUNG TOLD YOU THAT APPLE HAD DECLARED WAR ON
23
GOOGLE.
24
FABULOUS ADVERTISING CAMPAIGN AND THAT APPLE WAS WORRIED THAT
25
NO ONE WANTED ITS PRODUCTS.
THEY TOLD YOU THAT APPLE WAS BEATEN DOWN BY SAMSUNG'S
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OBVIOUSLY NONE OF THAT IS TRUE.
BUT THINK FOR A MINUTE.
SUPPOSE IT WERE TRUE.
SUPPOSE
THAT THEY WERE RIGHT ABOUT THAT.
DEMAND IN AUGUST 2011 HIGHER OR LOWER?
DO YOU CHARGE LESS TO A
COMPETITOR THAT YOU ARE WORRIED ABOUT?
I DON'T THINK SO.
DON'T THINK YOU DO.
CHARGE THEM MORE.
8
9
WOULD THAT HAVE MADE APPLE'S
IF YOU ARE WORRIED ABOUT A COMPETITOR, YOU
THE SIMPLE TRUTH IS THAT WHEN YOU REACH THIS POINT IN THE
INSTRUCTIONS AND WHEN YOU CONSIDER THE FACTS THAT ARE SET OUT
10
IN YOUR INSTRUCTIONS AND ASK THE QUESTIONS THAT THE LAW ASKS
11
YOU TO -- TELLS YOU TO ASK, WHAT WOULD HAVE HAPPENED IN THIS
12
HYPOTHETICAL WORLD?
13
TAKEN?
14
ROYALTY IS ACCURATE, FAIR, AND BALANCED.
15
WHAT POSITION WOULD THE PARTIES HAVE
YOU WILL SEE THAT DR. VELLTURO'S OPINION ON REASONABLE
THE ROYALTIES HE SET FOR EACH PATENT ARE NOT HIGHER THAN
16
APPLE WOULD HAVE ASKED, AND SAMSUNG, FACING A CRISIS OF DESIGN,
17
WOULD HAVE PAID THEM TO BE ABLE TO STAY IN THIS MARKET.
18
AFTER CONSIDERING ALL 15 FACTORS, DR. VELLTURO CALCULATED
19
A ROYALTY RATE FOR EACH OF THE FIVE PATENTS TO BE APPLIED
20
SEPARATELY TO PHONES AND TABLETS.
21
RATES ON SLIDE 96, BUT YOU WILL HAVE THEM IN EVIDENCE AT MY
22
FAMOUS PX 222A, AND THEY'RE AT PAGE 37 OF THAT EXHIBIT.
23
YOU CAN SEE THOSE ROYALTY
SO HOW WILL YOU FILL OUT THE VERDICT FORM ON THIS ISSUE?
24
QUESTION 9 ASKS YOU FOR A TOTAL OF DAMAGES, COMBINED LOST
25
PROFITS AND REASONABLE ROYALTY.
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2
3
AND THEN QUESTION 10A ASKS YOU FOR A DETAILED BREAKDOWN BY

PHONE, BY PATENT, AND BY TIME PERIODS.
WE HAVE PROVIDED YOU WITH A CHART THAT SHOWS YOU WHAT THE
VERDICT FORM WOULD LOOK LIKE IF YOU ACCEPTED DR. VELLTURO'S
OPINION.
MEMORIZE IT, BUT YOU COULD ALSO FIND IT AT PAGE 13A OF
EXHIBIT 222A.
8
9
IT'S ON THE SCREEN HERE.
YOU HAVE FOUR SECONDS TO
FINALLY, YOU WILL BE ASKED QUESTION 10B, WHICH ASKS YOU TO

BREAK OUT DAMAGES FOR THREE ACCUSED PHONES FOR THREE PARTICULAR
10
TIME PERIODS.
11
HERE IS HERE ON SLIDE 97, BUT YOU WILL ALSO FIND IT AT 222A AT
12
PAGE 12.
13
DR. VELLTURO'S OPINION AS TO THE CORRECT ANSWER
WHEN YOU LOOK AT EXHIBIT 222A, AND IF YOU LOOK AT PAGES 19
14
AND 24, YOU WILL FIND THAT WE HAVE GIVEN YOU ALTERNATIVE CHARTS
15
WITH LOWER DAMAGES AMOUNTS THAT YOU CAN USE TO FILL OUT THIS
16
VERDICT FORM.
17
WE DIDN'T DO THAT BECAUSE WE THINK IT'S RIGHT, BUT THEY
18
ARE ALTERNATIVES THAT WILL BE HELPFUL TO YOU IF YOU REACH
19
CONCLUSIONS ABOUT LIABILITY OR DAMAGES THAT ARE NOT THE ONES
20
FOR WHICH I'VE BEEN ADVOCATING.
21
WE PROMISED YOU THAT WE WOULD GIVE YOU THE INFORMATION YOU
22
NEED TO MAKE YOUR DECISION IN A FORM THAT WOULD BE EASY FOR YOU
23
TO USE AND WE HAVE KEPT OUR WORD.
24
IN CLOSING, I WOULD LIKE TO SAY THIS:
BRINGING THIS
25
LAWSUIT WAS APPLE'S LAST CHOICE, ITS LAST OPTION.
YOU KNOW
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THAT WE MET WITH SAMSUNG A YEAR BEFORE WE SUED AND TRIED TO
PERSUADE THEM TO COMPETE FAIRLY.
YOU KNOW, HOWEVER, FROM SAMSUNG'S INTERNAL DOCUMENTS THAT
SAMSUNG NEVER, EVER CONSIDERED THAT OPTION.
FOCUSSED ON THEIR OWN CRISIS OF DESIGN, AND THEIR REALIZATION
THAT THE ONLY WAY THEY COULD SUCCEED WAS, QUOTE, "TO MAKE
SOMETHING LIKE THE IPHONE."
8
9
THEY WERE TOO
SAMSUNG WAS COMMITTED TO TRYING TO GET AWAY WITH PATENT

INFRINGEMENT.
10
APPLE CANNOT SIMPLY WALK AWAY FROM ITS INVENTIONS.
11
CANNOT DO THAT TO THE PEOPLE THAT YOU SAW AND THE OTHER PEOPLE
12
LIKE THEM WHO WORKED SO HARD TO COME UP WITH SUCH FABULOUS
13
IDEAS.
14
15
APPLE
AND SO WE ARE HERE, 37 MILLION ACTS OF INFRINGEMENT LATER,

AND WE ARE COUNTING ON YOU FOR JUSTICE.
16
THE COURT:
OKAY.
17
MR. PRICE:
YOUR HONOR, MAY I JUST HAVE A SECOND TO
THE COURT:
OF COURSE.
18
TIME IS 10:54.
SET UP?
19
20
21
MR. QUINN:
YOUR HONOR, I'M READY.
22
THE COURT:
OKAY.
23
PLEASE.
24
///
25
///
TIME IS NOW 10:56.
GO AHEAD,
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(MR. PRICE GAVE HIS CLOSING ARGUMENT ON BEHALF OF

DEFENDANTS.)
MR. PRICE:
GOOD MORNING, LADIES AND GENTLEMEN OF THE
JURY.
WITNESSED IN A COURTROOM BEFORE, I THINK.
FROM FOUR LAWYERS IN CLOSING ARGUMENT, BECAUSE WE WANTED YOU TO
HEAR FROM THE LAWYERS WHO HAD PRESENTED WITNESSES ON RELEVANT
TOPICS.
IN.
10
YOU'RE GOING TO SEE SOMETHING THAT'S NEVER BEEN

YOU'RE GOING TO HEAR
THAT MIGHT HELP YOU REMEMBER THE TESTIMONY THAT CAME
PLUS NONE OF US IS AS DYNAMIC AS MR. MCELHINNY, SO WE
11
WANTED TO MAKE SURE YOU SAW A FEW DIFFERENT PERSONALITIES AT
12
THE SAME TIME.
13
14
15
I'M GOING TO TALK TO YOU ABOUT THE REAL WORLD EVIDENCE

ABOUT COPYING AND WHY SAMSUNG IS ABLE TO SELL ITS PHONES.
AND THEN YOU'RE GOING TO HEAR FROM MR. NELSON, WHO'S GOING
16
TO TALK TO YOU ABOUT SAMSUNG'S -- I MEAN APPLE'S PATENTS,
17
VALIDITY AND INFRINGEMENT.
18
19
YOU'RE GOING TO HEAR FROM MR. JOHNSON, WHO WILL TALK TO

YOU ABOUT SAMSUNG'S PATENTS.
20
AND THEN YOU'RE GOING TO HEAR FROM MR. QUINN, WHO'S GOING
21
TO TALK TO YOU ABOUT THE DAMAGES IN THIS CASE AND WHAT APPLE IS
22
ASKING FOR.
23
NOW, DURING THIS PRESENTATION, HIS PRESENTATION, I DON'T
24
KNOW HOW MANY TIMES MR. MCELHINNY SAID THAT BASICALLY SAMSUNG'S
25
SALES OF THESE ACCUSED PRODUCTS WERE CAUSED BECAUSE THEY HAD
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TECHNOLOGY RELATING TO THESE FIVE, THE FIVE PATENTS.
AND THEY'RE ASKING FOR A BIG NUMBER HERE, AND THE REASON
THAT YOU HEARD THE WORD "COPY" SO MUCH, I'M GOING TO SUBMIT TO
YOU, IS BECAUSE THEY HAVE TO TRY TO GET YOU A LITTLE ANGRY TO
JUSTIFY THIS KIND OF NUMBER.
COPY.
COPY.
STEAL.
I THINK IN THE OPENING MR. MCELHINNY SAID SOMETHING ABOUT
THE IPHONE BEING A HERO AND SAMSUNG TURNING TO THE DARK SIDE.
I DON'T KNOW IF YOU RECALL THAT.
WELL, FIRST LET ME ADDRESS COPYING, AND LET ME ADDRESS IT
10
VERY SQUARELY, AND I PUT THIS SLIDE UP HERE TO TALK ABOUT THESE
11
PARTICULAR PATENTS, AND IT'S TRUE THAT IF YOU DON'T PRACTICE A
12
PATENT, THAT DOESN'T MEAN THAT YOU CAN'T COLLECT DAMAGES FOR
13
IT.
14
PRACTICE AND SOMEONE ELSE IS.
15
16
17
YOU STILL GET DAMAGES IF YOU HAVE A PATENT THAT YOU DON'T
BUT YOU CAN'T COPY SOMETHING FROM THE IPHONE IF IT'S NOT
IN THE IPHONE.
AND THE UNDISPUTED EVIDENCE IS THAT APPLE, IN ITS IPHONE,
18
HAS NEVER PRACTICED THE '959, CLAIM 25 OF THE '959, WHICH IS
19
THE UNIVERSAL SEARCH; APPLE HAS NEVER PRACTICED, IN THE IPHONE,
20
CLAIM 20 OF PATENT '414, BACKGROUND SYNCHRONIZATION, IT DOESN'T
21
DO WHAT ITS PATENT SAYS; CLAIM 18 OF THE '172, THE WORD
22
SUGGESTION, APPLE HAS NEVER USED THAT CLAIM IN ITS IPHONE.
23
IT'S NOT PART OF THAT HEROIC IPHONE WHICH CAME OUT IN 2007.
24
25
SO SAMSUNG DIDN'T COPY IT.
GOOGLE DIDN'T COPY IT.
YOU
CAN'T COPY IT IF IT'S NOT THERE, IF APPLE DOESN'T PRACTICE IT.
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YOU'VE HEARD NO EVIDENCE IN THIS TRIAL AT ALL, BY THE WAY,
THAT PRACTICED -- THAT APPLE EVER PRACTICED CLAIM 9 OF THE '647
PATENT, WHICH IS THAT QUICK LINKS PATENT.
AND THE REASON, BY THE WAY, IS BECAUSE THESE PATENTS ARE
SPECIFIC WAYS, USING SPECIFIC ARCHITECTURES, TO ACCOMPLISH
SOMETHING.
WORD SUGGESTION.
THEY'RE NOT PATENTS COVERING UNIVERSAL SEARCH OR

THEY ARE PARTICULAR WAYS OF DOING IT.
SO YOU CAN'T COPY IF IT'S NOT IN THERE.
AND I THINK THE EVIDENCE SHOWS THAT, BY THE WAY THEY SLIDE
10
TO UNLOCK, APPLE'S PARTICULAR CLAIM ISN'T BEING PRACTICED BY
11
APPLE NOW WHEN THEY CHANGED IT IN IOS 7.
12
THE SECOND THING, OBVIOUSLY, IS THAT IN A DAMAGES CLAIM,
13
APPLE IS SAYING THAT, LOOK, SAMSUNG IS PRACTICING PARTICULAR
14
CLAIMS USING PARTICULAR ARCHITECTURE THAT'S CAUSING SALES, AND
15
IF IT COULDN'T DO THAT, IF IT WASN'T DOING THAT, THEN A LOT OF
16
PEOPLE WOULD COME TO APPLE, WHICH ALSO IS NOT PRACTICING THOSE
17
CLAIMS OF THOSE PATENTS.
18
AND THAT MAKES NO SENSE WHATSOEVER.
WHY WOULD YOU GO FROM
19
ONE PHONE THAT YOU BOUGHT TO ANOTHER WHICH LACKS THE SAME, YOU
20
KNOW, PRACTICE THAT THE PHONE YOU WERE WITH HAD?
21
MAKES NO SENSE.
22
IT SIMPLY
SO I WANTED TO TALK ABOUT THAT FIRST JUST TO SHOW WHY THIS
23
IS IMPORTANT, NOT BECAUSE YOU CAN'T COLLECT DAMAGES IF YOU HAVE
24
A PATENT THAT YOU'RE NOT PRACTICING.
25
COPY IT -- IF IT'S NOT IN YOUR PRODUCT, SOMEONE CAN'T COPY IT.
IT'S BECAUSE YOU CAN'T
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AND WHY WOULD SOMEONE COME TO YOUR PRODUCT IF YOU'RE NOT

PRACTICING THOSE SAME PATENTS?
SO LET ME GET A LITTLE BIT MORE DETAILED, THEN, INTO WHAT
WE SHOWED YOU.
CLAIMS THAT WERE IN THIS CASE WERE CREATED INDEPENDENTLY, NOT
COPIED, BY ANOTHER COMPANY WITH BRILLIANT ENGINEERS, GOOGLE,
RIGHT UP THE STREET.
8
9
10
11
12
13
THE TRUTH IS THAT THE PARTICULAR PATENTED
AND THE TRUTH IS THAT SAMSUNG SOLD MORE THAN ANY OTHER
ANDROID PHONE MAKER BECAUSE IT MADE THE BEST HARDWARE FOR THAT
ANDROID PLATFORM WHICH GOOGLE INDEPENDENTLY CREATED.
AND APPLE IS TRYING TO DISTRACT YOU FROM THAT BY SAYING
COPYING AND BY, BY INTENTIONALLY MISINTERPRETING THE DOCUMENTS.
AND LET ME START WITH THE CRISIS OF DESIGN, AND THAT'S
14
EXHIBIT 149.
THAT WAS IN FEBRUARY OF 2010.
IT WAS A
15
PRESENTATION GIVEN BY THE HEAD OF THE MOBILE DIVISION.
16
REALLY ASK YOU TO LOOK AT THAT.
17
IN SAMSUNG'S OWN WORDS, THEY WERE TO COPY THE IPHONE.
18
THAT'S NOT WHAT THAT SPEECH WAS ALL ABOUT.
YOU HEARD MR. MCELHINNY SAY,
WHEN YOU READ
19
ABOUT IT, YOU SEE THAT, YES, THEY ARE PRAISING THE IPHONE.
20
REALLY DID COME OUT AND SURPRISE THE INDUSTRY.
21
IT
AND THEY ARE ALSO SAYING THE OMNIA, A SAMSUNG PHONE WHICH
22
USED THE MICROSOFT PLATFORM, THAT'S THE ONE MADE UP IN
23
WASHINGTON BY ANOTHER COMPANY, YOU KNOW, IT WASN'T VERY GOOD
24
COMPARED TO THE APPLE OPERATING PLATFORM.
25
THE DOCUMENT.
AND THAT'S PART OF
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BUT THE LANGUAGE ABOUT COPYING THE IPHONE, THAT'S WHAT

CARRIERS WERE SAYING.
AND IF WE CAN SHOW THAT, KEN?
AND WHAT WAS BEING SAID HERE IS THAT, YOU KNOW, SAMSUNG IN
THE PAST HAD ALWAYS LISTENED TO CARRIERS, THE KIND THAT SAYS
YES TO WHATEVER A CARRIER WANTS, THAT'S A SHORTCUT TO GOING OUT
OF BUSINESS.
8
9
AND YOU HEARD MR. SOHN COME HERE AND TELL YOU THAT, YOU
KNOW, BEFORE, BEFORE ACTUALLY THE IPHONE AND FOR A FEW YEARS
10
AFTERWARDS, THAT THE MANUFACTURERS LISTENED TO CARRIERS AS TO
11
WHAT TO DO AND WHAT PHONES TO MAKE INSTEAD OF GOING DIRECTLY TO
12
THE CONSUMER.
13
AND HE SAYS, "I HEAR THINGS LIKE LET'S MAKE SOMETHING LIKE
14
THE IPHONE," AND THAT'S COMING FROM THE CARRIERS.
NOWHERE IN
15
THAT DOCUMENT DOES HE SAY "LET'S COPY THE IPHONE."
AND THEY
16
DON'T COPY THE IPHONE.
17
WHAT HE'S SAYING IS THAT WE ARE BEHIND.
WE NEED TO FIND
18
AN OPERATING SYSTEM PLATFORM.
19
WILL SEE IN THAT TIMEFRAME THAT SHOW JUST THAT, AND THAT IS
20
EXHIBIT, FOR EXAMPLE, EXHIBIT 201.
21
THIS DURING THE TRIAL.
22
AND THERE ARE DOCUMENTS THAT YOU
MR. MCELHINNY SHOWED YOU
AND IF YOU GO TO PAGE -- KEN, PAGE 17 -- DO YOU REMEMBER,
23
THIS WAS IN 2009 AND IT'S AN INTERNAL SAMSUNG DOCUMENT, AND DO
24
YOU REMEMBER MR. MCELHINNY SAID THAT HARDWARE USED TO BE THE
25
PRIMARY BUYING FACTOR AND NOW IT'S SOFTWARE, AND YOU HEARD HIM
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SAY AGAIN IN CLOSING THAT SOFTWARE IS WHAT SELLS PHONES, NOT
HARDWARE.
WELL, THAT'S MISLEADING BECAUSE WHAT THIS IS TALKING
ABOUT, YOU SEE HARDWARE IS THE PRIMARY BUYING FACTOR.
YOU USED TO GO INTO A STORE AND YOU WOULD BUY A PHONE BECAUSE
IT WAS A FLIP PHONE OR IT WAS A CAMERA PHONE OR WHATEVER?
7
8
OKAY.
WELL, THOSE DAYS ARE OVER.
REMEMBER
PEOPLE BUY PHONES NOW
FOR CONTENT, FOR SERVICES.
AND WHAT MR. MCELHINNY DIDN'T SHOW YOU WAS THE SECOND PART
10
HERE.
APPLE USES APPLICATIONS, NOT HARDWARE, FOR SEGMENTATION.
11
AND THIS IS HARD TO SEE.
12
CUSTOMIZATION.
IT'S EXPERIENCE DRIVEN BY AFTERMARKET
13
AND IF YOU LOOK THROUGH THIS DOCUMENT -- AND I ASK YOU TO
14
LOOK ALSO AT PAGES 13 AND 81 -- SAMSUNG WAS IN A PLACE WHERE IT
15
HAD TO FIND AN OPERATING SYSTEM IT COULD USE THAT PEOPLE COULD
16
THEN DOWNLOAD THESE WONDERFUL APPLICATIONS THAT CONSUMERS NOW
17
WANTED FROM THIRD PARTIES, SO IT COULD DOWNLOAD MAPS OR NETFLIX
18
OR PLANTS VERSUS ZOMBIES OR CUT THE ROPE OR MARVEL COMICS.
19
THAT WAS AN IMPORTANT PART.
20
AND WHEN YOU SEE THESE DOCUMENTS THAT SAY SOFTWARE IS A
21
DRIVING FACTOR, READ THE DOCUMENT CAREFULLY, BECAUSE WHAT IT
22
SAYS IS THEY'RE TALKING ABOUT THE SOFTWARE THAT ALLOWS THE
23
CONSUMER EXPERIENCE OF GETTING THESE APPLICATIONS ON THE PHONE
24
SO THE CUSTOMER CAN CUSTOMIZE HIS OWN PHONE.
25
SAMSUNG RECOGNIZED THAT'S WHAT IT NEEDED BACK IN 2009, AND
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THE WAY IT RESOLVED THAT PROBLEM IS UNDISPUTED.
DOCUMENTS THEMSELVES.
PLATFORM AS, BY THE WAY, HAVE ALMOST EVERY OTHER MANUFACTURER.
I MEAN, THE ANDROID PLATFORM IS THE WORLD'S ALTERNATIVE TO
APPLE'S IOS.
IT'S IN THE
IT CHOSE TO GO WITH GOOGLE'S ANDROID
AND WE'VE BROUGHT IN HERE AND YOU HEARD MR. LOCKHEIMER
TESTIFY, HIROSHI LOCKHEIMER.
AND GOOGLE RECOGNIZED THIS NEED
WAY BACK IN 2006.
IN 2006, AND THAT IS THAT MANUFACTURERS WEREN'T CONCENTRATING
MR. LOCKHEIMER JOINED THEM IN 2006, GOOGLE
10
ON SOFTWARE AND THAT GOOGLE DECIDED TO BUILD A PLATFORM, WHICH
11
BECAME ANDROID, THAT WOULD BE FLEXIBLE AND OPEN SOURCED.
12
WOULD BE AN OPEN PLATFORM THAT WOULD GIVE YOU THE GUTS ON
13
OPERATING SYSTEM THAT ANY MANUFACTURER COULD USE AND THEN
14
APPLICATION DEVELOPERS, THE PEOPLE WHO WRITE ALL THOSE COOL
15
APPS, YOU KNOW, COULD MAKE FOR IT AND IT WOULD WORK WITH THAT
16
PLATFORM.
17
18
19
20
IT
AND, OF COURSE, GOOGLE MAKES ITS OWN, YOU KNOW, ITS OWN
APPLICATIONS.
AND THEY BEGAN DOING THAT, AGAIN, BACK IN 2006.
THEY HAD
A VERSION 1 OUT IN 2008.
21
AND HERE'S THE KEY UNDISPUTED FACT IN THIS CASE:
22
EVERY PATENT WHICH APPLE CLAIMS IS INFRINGED IN THIS CASE IS
23
INFRINGED WITH THE BASIC GOOGLE ANDROID SOFTWARE BECAUSE THEY
24
INCLUDE -- THEY ACCUSE THE GALAXY NEXUS OF INFRINGING EVERY ONE
25
OF THEIR FIVE PATENTS, AND YOU HEARD MR. LOCKHEIMER TELL YOU
THAT
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THAT THE SOURCE CODE, THE CODE FOR EVERY ONE OF THOSE FEATURES
WAS DEVELOPED BY ENGINEERS AT GOOGLE.
AND THIS IS NOT -- THIS IS DIFFERENT, KEN.
THIS IS NOT SAYING, POINTING A FINGER AT GOOGLE OR ANDROID
WHATSOEVER.
PARTICULAR METHODOLOGIES AND ARCHITECTURES THAT THEY CLAIM ARE
INFRINGED.
8
9
10
NO.
THIS IS SAYING THAT APPLE HAS FIVE PATENTS WITH
WE BROUGHT IN THE GOOGLE FOLKS, THE GOOGLE ENGINEERS
WHO INDEPENDENTLY DEVELOPED WHAT ANDROID DOES AND TOLD YOU IT

WAS DIFFERENT, DIFFERENT ARCHITECTURE, AND THAT'S SLIDE 20.
11
PUT THAT UP.
12
AND YOU'RE GOING TO HEAR MORE ABOUT THEM WHEN MR. NELSON
13
TALKS.
14
THEY INDEPENDENTLY DEVELOPED THESE FEATURES AND THAT THEY DON'T
15
INFRINGE.
16
WE'RE NOT POINTING THE FINGER AT GOOGLE.
WE'RE SAYING
WE BROUGHT YOU THE INVENTORS, SHALL WE SAY.
AND A QUICK DISTRACTION ON THE INVENTORS.
THE JUDGE
17
INSTRUCTED YOU AT THE TIME THE EVIDENCE CAME IN AS TO WHAT THAT
18
WAS RELEVANT TO -- THAT'S T-284, KEN -- AND THAT'S RELEVANT TO
19
POSSIBLE BIAS.
20
POTENTIAL BIAS, A FINANCIAL RESULT PUT IN THE CASE, OR THEY
21
COULD SOMEHOW LOSE MONEY, THAT'S SOMETHING YOU CAN CONSIDER IN
22
SEEING WHETHER THEY'RE TRUTHFUL.
23
IF A WITNESS TAKES THE STAND, IF THEY HAVE A
BUT WHEN THOSE WITNESSES TOOK THE STAND, APPLE KNEW ABOUT
24
THE ABILITY TO DO THAT.
APPLE KNEW -- THEY DIDN'T ASK THOSE
25
WITNESSES IF THEY KNEW, THEY DIDN'T ASK THE WITNESSES IF THEY
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2
WERE BIASED, AND YOU COULD SEE THAT THEY WEREN'T BIASED.
WHO IN THIS TRIAL HAS TRIED TO HIDE FROM YOU THE RELEVANCE
OF GOOGLE IN THIS CASE?
APPLE.
IT'S NOT -- IT'S NOT SAMSUNG.
IT'S
EVERY WITNESS WAS ASKED, GOOGLE IS NOT A PARTY TO THIS
CASE, YOU KNOW?
THIS CASE?
APPLE TO GIVE YOU THE IMPRESSION THAT GOOGLE WAS IRRELEVANT.
YOU UNDERSTAND THAT GOOGLE IS NOT A PARTY TO
EVERY ONE OF THOSE WITNESSES WAS ASKED THAT BY
GOOGLE IS CRITICAL ON THE QUESTION OF COPYING BECAUSE WE
10
DIDN'T COPY.
11
THE ENGINEERS WHO CAME UP WITH THESE FEATURES CAME IN HERE AND
12
TOLD YOU THEY DIDN'T COPY.
13
SAMSUNG DIDN'T COPY.
THEY WEREN'T TOLD TO COPY.
NOW, THERE'S ONE AREA, WHEN YOU USE THE GOOGLE OPERATING
14
SYSTEM, THERE ARE SOME DIFFERENCES YOU CAN MAKE, LITTLE CHANGES
15
YOU CAN MAKE TO IT SO THAT YOU CAN DIFFERENTIATE YOURSELF FROM
16
ANOTHER COMPANY, LIKE HTC OR MOTOROLA, AND ONE OF THOSE WAS THE
17
COVER, THE SLIDE TO UNLOCK.
18
YOU CAN CUSTOMIZE THAT.
NOW, APPLE ACCUSES GOOGLE'S WAY OF DOING THAT AS
19
INFRINGING.
20
CAME UP WITH THEY CLAIM INFRINGES.
21
THE BASIC ANDROID CODE WHICH GOOGLE INDEPENDENTLY
WELL, WE BROUGHT IN BEFORE YOU SAMSUNG'S SOFTWARE DESIGNER
22
ON, YOU KNOW, THE FACE OF THE PHONE, AND YOU HEARD FROM
23
YOUNGMI KIM, AND SHE TESTIFIED ABOUT WHETHER OR NOT SHE COPIED
24
APPLE'S SLIDE TO UNLOCK AND SHE SAID ABSOLUTELY NOT, AND SHE
25
POINTED OUT THAT THEY TRY TO DIFFERENTIATE THEIR PRODUCTS.
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AND WHEN YOU SAW HER TESTIFY, YOU COULD EVALUATE HER
DEMEANOR.
AND IF YOU LOOK AT HER WORK -- AGAIN, LOOK AT WHAT YOU DO,
NOT WHAT YOU SAY -- IF WE CAN PUT UP CHART 47 -- IF YOU LOOK AT
HER WORK -- BOY, THIS IS HARD TO SEE -- SHE CAME UP, FOR
EXAMPLE, WITH THE PUZZLE DESIGN BACK IN 2008/2009.
NOW, YOU'VE SEEN SOME DOCUMENTS THAT ARE FROM THE SOFTWARE
VERIFICATION GROUP WHICH COMPARE APPLE AND IPHONE ON MANY
LEVELS AND SOME TALK ABOUT ELEMENTS OF SLIDE TO UNLOCK.
10
AND WHAT SHE TOLD YOU WAS THESE ARE KIND OF LIKE BOOK
11
REPORTS THAT SHE LOOKS AT AND, FRANKLY, SHE PAYS NO ATTENTION
12
TO THEM.
13
BY THE RESULTS OF HER WORK.
14
15
16
AND THE WAY YOU KNOW SHE PAYS NO ATTENTION TO THEM IS

SHE DID NOT COPY THE IPHONE.
LOOK AT WHAT SHE CAME OUT WITH.
WELL, THERE WAS THE SLIDE
TO UNLOCK WHICH LOOKS ABSOLUTELY NOTHING LIKE THE IPHONE.

SHE CAME OUT WITH THE GALAXY S II.
THE GALAXY S II IS --
17
IN FACT, KEN, MAYBE WE CAN PUT UP SLIDE 44 BECAUSE I'M NOT
18
GOING TO HAVE TIME TO SHOW YOU THE PHONE ITSELF -- THAT'S ONE
19
OF THOSE WHERE THE WHOLE SCREEN SLIDES TO UNLOCK.
20
APPLE DOES NOT ACCUSE THAT OF INFRINGING.
21
ANOTHER DESIGN SHE CAME UP WITH WAS IN THE GALAXY NOTE
22
WHERE YOU SEE THIS CIRCLE HERE AND YOU MOVE YOUR FINGER OUTSIDE
23
THE CIRCLE AND IT UNLOCKS.
24
APPLE DOES NOT ACCUSE THAT OF INFRINGING.
25
SHE CAME UP WITH THE RIPPLE, THE GALAXY S III, WHERE YOU
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SLIDE -- YOU SWIPE TO UNLOCK.
INFRINGING.
APPLE DOES NOT ACCUSE THAT OF
IN FACT, THEIR EXPERT TOOK THE STAND -- IF WE CAN GO BACK
TO THAT CHART, 47, KEN -- LOOK, THESE ARE COMING OUT BEFORE
APPLE'S PATENT IS EVEN ISSUED.
AND MR. MCELHINNY CAME UP HERE AND TOLD YOU THAT SAMSUNG
COPIED, YOU KNOW, APPLE'S SLIDE TO UNLOCK PATENT.
MAKE SENSE.
AND THEIR OWN EXPERT, MR. COCKBURN, CAME UP HERE AND TOLD
10
YOU THERE IS NO EVIDENCE.
11
KEN, THE COCKBURN TESTIMONY.
12
13
IT DOESN'T
AND THIS IS, I BELIEVE, T-281, 2 --
YOU'RE NOT TALKING ABOUT ANYBODY COPYING THE PATENT;

CORRECT?
14
RIGHT.
15
THERE'S NO COPYING IN THIS CASE.
THERE WAS A DISCUSSION
16
AND COMPARISON OF THE PHONES.
17
INDEPENDENT GENIUSES AT GOOGLE, THE BASIC ANDROID.
18
THE CODE WAS CREATED BY THESE
YOU KNOW, ANY CHANGE THAT SAMSUNG MADE HAD THE EFFECT OF
19
NOT CHANGING THAT, NOT CHANGING THAT BASIC GOOGLE CODE.
THERE
20
IS NO COPYING.
21
YOU CAN GET ENRAGED AND THINK THAT THERE SHOULD BE, YOU KNOW,
22
BIG MONEY DAMAGES AWARDED.
BUT THEY HAVE TO MAKE YOU THINK THAT SO THAT
23
SO LET ME THEN GO INTO -- AND I ALMOST FORGOT ON THIS --
24
SO WE HAVE, YOU KNOW, GOOGLE, GOOGLE ENGINEERS DEVELOPING THIS
25
CODE.
YOU ARE ASKED, WHERE WERE YOU IN 2007, YOU KNOW, WHEN
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APPLE CAME OUT?
PRACTICING MOST OF THESE PATENTS, AT THIS POINT ALL OF THEM.
AND DIDN'T HAVE -- BY THE WAY, IT WASN'T
THE QUESTION WAS, WHERE WERE THEY, LIKE, IN 2010, 2011?
WE KNOW WHAT STEVE JOBS THOUGHT.
BEHIND ANDROID AT THAT TIME AND HE THOUGHT THAT THEY HAD TO
DECLARE A HOLY WAR ON ANDROID, AND THAT'S EXHIBIT 489, AND IF I
HAD A BUCK IN MY POCKET, I WOULD GIVE IT TO MR. MCELHINNY,
BECAUSE IT'S CRITICAL AS TO WHAT THIS CASE IS REALLY ABOUT.
9
10
11
STEVE JOBS THOUGHT THEY WERE
I MEAN, SAMSUNG, MOTOROLA, HTC AND OTHERS CHOSE ANDROID AS

A PLATFORM.
AND WE KNOW, IN OCTOBER 2010, STEVE JOBS RECOGNIZED WE
12
HAVE TO START A HOLY WAR ON GOOGLE.
THAT'S WHAT 2011 WAS GOING
13
TO BE ALL ABOUT.
14
EXECUTIVES GETTING TOGETHER AND MEETING WAS THIS HOLY WAR.
15
AND IF YOU LOOK THROUGH THIS DOCUMENT -- AND DO FLIP
IT WAS THE PRIMARY REASON FOR THESE
16
THROUGH IT -- EVERYONE WAS SUPPOSED TO TALK ABOUT GOOGLE AND
17
ANDROID AND IT WAS ALL ABOUT APPLE BEING IN DANGER OF HANGING
18
ON TO AN OLD PARADIGM TOO LONG, AN INNOVATOR'S DILEMMA.
19
GOOGLE AND MICROSOFT WERE FURTHER AHEAD IN TECHNOLOGY.
IF
20
YOU GO THROUGH THIS, THEY'RE GOING TO SEE THAT GOOGLE WAS AHEAD
21
IN THE CLOUD, WHICH IS WHERE THE FUTURE WAS GOING, YOU KNOW,
22
WHERE YOU SYNC THROUGH THE CLOUD; THAT GOOGLE WAS AHEAD IN
23
CALENDAR.
24
AND IF YOU KIND OF FLIP THROUGH SOME OF THESE, YES,
25
SAMSUNG IS MENTIONED ALONG WITH GOOGLE, HTC, MOTOROLA, AND RIM.
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SAMSUNG IS JUST ONE OF THOSE MANUFACTURERS.
AT THIS TIME
SAMSUNG WAS NOT THE LEADING ANDROID MANUFACTURER.
THE FOCUS IS ON WE HAVE A HOLY WAR WITH GOOGLE.
AND THEY WERE GOING TO TARGET WHOEVER BECAME THE LARGEST
GOOGLE ANDROID SELLER, THE LARGEST COMPANY THAT SOLD THIS
INDEPENDENTLY DEVELOPED PLATFORM THAT YOU COULD THEN USE TO
DOWNLOAD YOUR APPLICATIONS AND WATCH TV AND DO ALL THAT FUN
STUFF.
SO HOW DID WE START, HOW DID SAMSUNG START INCREASING ITS
10
SALES?
11
PARTICULAR WAYS OF DOING SOMETHING THAT GOOGLE INDEPENDENTLY
12
DEVELOPED AND WAS DIFFERENT.
13
14
15
IT WASN'T BECAUSE IT COPIED.
IT WASN'T BECAUSE OF FIVE
THE WAY THEY DID IT WAS THEY HAD A PARADIGM SHIFT, AND YOU
HEARD FROM MR. SOHN, WHO CAME IN.
AND BY THE WAY, THERE'S CRITICISM THAT WE DIDN'T BRING IN
16
EXECUTIVES.
17
FEATURES, WHICH ARE THE GOOGLE ENGINEERS.
18
WE BROUGHT IN TO YOU THE INVENTORS OF THE ACCUSED
WE BROUGHT IN TO YOU, IN FOR YOU TO LOOK AT AND LISTEN TO
19
MS. YOUNGMI KIM, WHO WAS IN CHARGE OF THAT SLIDE TO UNLOCK.
20
AND WE BROUGHT TO YOU DALE SOHN, WHO WAS PRESIDENT OF
21
SAMSUNG AMERICA, AND AS YOU SAW ON THE OTHER SLIDES, WAS KEY
22
ADVISER, YOU KNOW, IN KOREA.
23
AND HE EXPLAINED TO YOU THAT THERE WAS A PARADIGM SHIFT
24
FROM WHAT WE REALIZED -- IF WE CAN PUT UP 156.21 -- WE REALIZED
25
THAT WE HAD TO BRAND SAMSUNG, WE HAD TO GET CONSUMERS TO KNOW
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WHO WE WERE AND TO GO INTO STORES TO ASK FOR THEM.

SAMSUNG WAS WELL KNOWN IN TV'S, YOU KNOW, BUT NOT IN
PHONES.
SO LET'S FOCUS ON BRANDING.
LET'S IMPROVE OUR RETAIL
PRESENCE.
LET'S BE FRIENDLY TO THE RETAILERS IN THIS REGARD.
OUR INVESTMENT STRATEGY IN MARKETING SO THAT WE'RE PROMOTING
OUR BRAND.
LET'S GO AND CREATE SPECIAL AREAS IN THE RETAILERS.

LET'S SHIFT
AND BY THE WAY, THAT DIDN'T INCREASE OUR ADVERTISING
10
DOLLARS.
YOU HEARD MR. PENDLETON, WHO'S HEAD OF MARKETING, SAY
11
IT JUST SWITCHED IT SO THAT SAMSUNG WAS CONTROLLING THE BRAND.
12
AND THEN LET'S MAKE SURE THAT OUR PRODUCTS ARE FLAWLESS.
13
AND MR. PENDLETON CAME UP HERE AND TOLD YOU WHAT THE FOCUS
14
WAS ON, HOW ARE WE SELLING THESE PHONES?
15
PLATFORM, A PLATFORM THAT'S USED BY THE REST OF THE WORLD
16
EXCEPT FOR IOS, SO HOW DO WE SELL SAMSUNG PHONES?
17
18
19
WE'RE USING A COMMON
BECAUSE AT THAT TIME, HTC WAS SELLING, WHAT, TWICE AS MUCH

AS WE WERE OF THE ANDROID PLATFORM.
AND HE EXPLAINED TO YOU THAT WE CREATED THESE ADS AND WE,
20
WE FOCUSSED ON OUR LEADERSHIP IN BIG SCREEN, 4G TECHNOLOGY.
21
LATER TALKED ABOUT, YOU KNOW, THE QUALITY OF THE SCREEN.
22
23
24
25
HE
IT'S THE HARDWARE THAT DISTINGUISHED US FROM THE REST OF

THE WORLD THAT WAS USING THE BASIC GOOGLE ANDROID SOFTWARE.
AND IT WORKED.
AND THE WAY YOU KNOW IT WORKED IS THAT
APPLE LATER STARTED PANICKING.
THEY WERE -- FIRST, THE
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BRANDING WAS WORKING.
WAS ON THE STAND, WE SHOWED HIM AN E-MAIL WHICH HAD THE
"WALL STREET JOURNAL" ARTICLE THAT, THAT IS APPLE LOSING ITS
COOL TO SAMSUNG AND HE SAID WE'VE GOT TO DO SOMETHING ABOUT
THIS.
YOU REMEMBER THAT MR. SCHILLER, WHEN HE
AND THE RESPONSE FROM, FROM THE LEAD ADVERTISING AGENCY,
THE ONLY ADVERTISING AGENCY THAT THEY HAD USED FOR, WHAT, EVER,
A FELLOW NAMED JAMES VINCENT WAS, AND THIS IS 408A-3, WAS WE'VE
GOT TO DO SOMETHING HERE.
10
11
WHAT CAN WE DO?
HE'S TALKING ABOUT THINGS THAT APPLE CAN DO, BIGGER

SCREENS, THE APPLE BRAND IS SLIPPING.
12
AND THAT WAS EXACTLY WHAT MR. SOHN WAS TRYING TO DO,
13
CONCENTRATE ON THE HARDWARE AND ON THE BRAND, AND APPLE, AS A
14
RESULT OF THAT, WAS LOSING SALES TO SAMSUNG BECAUSE OF APPLE'S
15
HARDWARE, BECAUSE OF THAT.
16
AND BY THE WAY, JUST BECAUSE I DON'T HAVE TIME TO SHOW
17
THEM TO YOU, IF YOU LOOK AT EXHIBITS 409, 410, AND 498, THERE'S
18
THE STRING OF E-MAILS, YOU KNOW, BETWEEN MR. SCHILLER AND
19
OTHERS TALKING ABOUT WHAT ARE WE GOING TO DO?
20
SOMETHING FAST.
21
WE'VE GOT TO DO
WE HAVE TO MAKE DRASTIC CHANGES.
BY THE WAY, THEIR DRASTIC CHANGE WAS THAT, IN THAT SUMMER,
22
FOR THE FIRST TIME IN 14 YEARS, I BELIEVE, 15 YEARS, THEY
23
DECIDED TO DO A BRAND CAMPAIGN THEMSELVES, AND THEIR BRAND
24
CAMPAIGN IS PROBABLY ONE OF THE MOST SIMPLE YOU'VE EVER HEARD
25
OF.
IT WAS, DESIGNED BY APPLE IN CALIFORNIA, AS OPPOSED TO
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OURS.
SO APPLE, IN THE REAL WORLD, RECOGNIZED WHY SAMSUNG PHONES
WERE SELLING, NOT BECAUSE OF APPLE'S ACCUSED PATENTS.
ANOTHER WAY YOU KNOW THEY RECOGNIZED WHY WE WERE SELLING
IS THEY TOOK APART, THEY DIVISECTED -- THEY DISSECTED THE
SAMSUNG PHONES, AND IF YOU LOOK AT 489 AND JUST LOOK THROUGH
THAT, THAT'S A NUMBER OF DOCUMENTS THAT SHOWED HOW APPLE WOULD,
YOU KNOW, TAKE THINGS APART AND LOOK AT THE WIRES AND GUESS
WHERE THE WIRES CAME FROM.
EMPLOYEES WOULD GO OUT AND BUY
10
THESE PHONES SO THAT THEY COULD TAKE THEM APART, YOU KNOW, LIKE
11
A FROG.
12
AND THEIR CONCLUSIONS -- IF YOU GO TO PAGE 37 -- WAS --
13
THIS WAS APPLE'S MARKET RESEARCH.
14
SAMSUNG PHONES GOOD?
15
LIGHT, VERY FAST, GREAT CAMERA, ATTRACTIVE DESIGN, ENDLESS
16
FEATURES AND CUSTOMIZATION OPTIONS.
17
BEAUTIFUL SCREEN, INSANELY SLIM AND
BY THE WAY, THE BASIC OPERATING SOFTWARE, THEY DIDN'T
18
THINK SAMSUNG WAS VERY GOOD.
19
FRIENDLY AS HTC AND PHONE RIVALS.
20
THE GOOD, WHY ARE THESE
THEY SAID WE WEREN'T AS USER
SO LET'S TALK ABOUT, BEFORE WE COME TO COURT AND SEEK LOTS
21
OF MONEY FOR THINGS THAT APPLE ITSELF DOES NOT EVEN USE, YOU
22
KNOW, BEFORE WE COME TO COURT, WHAT'S APPLE SAID ITSELF AS TO
23
WHY SAMSUNG IS DOING WELL?
24
25
NOT BECAUSE OF THESE PARTICULAR WAYS OF DOING PARTICULAR

FEATURES, BUT BECAUSE OF WHAT MR. SOHN TOLD YOU, MR. PENDLETON,
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BECAUSE OF THE BRANDING, BECAUSE OF THE HARDWARE.

AND THE FINAL DOCUMENT I'M GOING TO TALK TO YOU ABOUT IS
THE OFF SITE THAT TOOK PLACE SHORTLY AFTER THESE E-MAILS OF
MR. SCHILLER IN THE SUMMER OF 2012.
THIS IS EXHIBIT 413.
AND BY THE WAY, THERE WAS A SUGGESTION THAT THIS EXHIBIT
WAS DONE BY SOME LONE MADMAN, I THINK MR. SCHILLER WAS
BASICALLY TRYING TO GET YOU TO THINK.
8
9
ACTUALLY, IF YOU LOOK AT EXHIBIT 411, YOU'LL SEE ANOTHER

DRAFT OF THIS, WHICH IS DISTRIBUTED WIDELY, AND IT'S CALLED THE
10
OPPENHEIMER IPHONE REVIEW.
11
APPLE.
12
MR. OPPENHEIMER WAS THEN THE CFO OF
AND IF WE LOOK AND SEE WHAT THEY RECOGNIZED WAS GOING ON,
13
FIRST THEY RECOGNIZE THAT THEIR IPHONE SALES WERE, THE GROWTH
14
WAS SLOWING.
15
I MEAN, THEY'RE STILL SELLING PHONES AND SELLING OUT EVERY
16
PHONE THEY COME OUT WITH.
17
LIKE APPLE LOVE APPLE.
18
KNOW THERE ARE A LOT OF YOU ON THE JURY WHO LOVE APPLE.
19
THEY'RE STILL SELLING MORE PHONES THAN ANYBODY.
PEOPLE LIKE APPLE, AND PEOPLE WHO
RAISE YOUR HAND IF YOU LOVE APPLE.
WHY WERE THEY SLOWING?
WELL, THEY VIEWED INTERNALLY WHY,
20
HERE'S THEIR INTERNAL VIEW AS TO WHY.
21
HERE WE GO, 814.
22
LET'S GO TO PAGE 814,
WHAT'S GOING ON?
IT'S BECAUSE THE STRONGEST DEMAND IS COMING FROM LESS
23
EXPENSIVE -- NOT APPLE -- AND LARGE SCREEN SMARTPHONES.
24
EXACTLY WHAT, EVEN BACK THEN IN THAT, QUOTE, "DESIGN OF CRISIS"
25
E-MAIL, EXACTLY WHAT SAMSUNG'S STRATEGY WAS.
LET'S TAKE
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ADVANTAGE OF OUR ADVANTAGE IN THE HARDWARE.

AND THEN THE CARRIERS, THE PEOPLE WHO SELL THE PHONES,
WERE GETTING SICK OF APPLE.
PHONES COST APPLE -- I MEAN THE CARRIERS, LIKE, $700, $600.
WHEN YOU BUY THEM FOR CHEAPER, THE CARRIER IS PAYING A SUBSIDY.
IT'S LOSING MONEY.
7
8
9
10
DO YOU KNOW WHY?
BECAUSE THOSE
AND THE CARRIERS ARE CAPPING THE SALES BECAUSE OF SUBSIDY

PREMIUMS, UNFRIENDLY POLICIES.
APPLE IS THOUGHT OF AS BEING ARROGANT.
AND THEN WE LOOK AT THE LAST ONE.
THE COMPETITORS -- AND
11
BY THE WAY, YOU SEE THIS ISN'T SAMSUNG HERE, IT'S ANDROID,
12
BECAUSE THAT'S WHO THE HOLY WAR IS AGAINST BY THE WAY.
13
AND COMPETITORS HAVE DRASTICALLY IMPROVED THEIR HARDWARE
14
AND IN SOME CASES THEIR ECOSYSTEMS, WHICH IS, YOU KNOW, AGAIN,
15
THOSE GREAT APPLICATIONS YOU HAVE AND THE GOOGLE APPS AND LIKE
16
THE SAMSUNG HUB AND THINGS LIKE THAT, YOU KNOW?
17
18
19
IT SAYS SPENDING OBSCENE AMOUNTS, BUT ACTUALLY WE WERE

SPENDING THE SAME AMOUNT, JUST DOING IT BETTER.
AND SO THEIR FINAL CONCLUSION, APPLE'S INTERNAL VERDICT AS
20
TO WHY WE WERE SELLING PHONES, THEY COME IN HERE AND THEY SAY
21
THAT CONSUMERS WANTED SAMSUNG PHONES BECAUSE SAMSUNG COPIED
22
APPLE.
23
24
25
THAT WAS NOT THEIR INTERNAL VERDICT.
THEIR INTERNAL
VERDICT -- AND THIS IS PAGE -- BRING ME BACK -- 46?

MR. KOTARSKI:
46.
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MR. PRICE:
46, THEIR CONCLUSION, "CONSUMERS WANT
WHAT WE DON'T HAVE."

WHERE DID THE GROWTH COME FROM?
IT'S COMING FROM WHAT
APPLE DOES NOT HAVE, NOT FROM WHAT APPLE DOES HAVE AND SOMEONE
ELSE COPIED.
THAT'S THE REAL WORLD, NOT THE MADE-UP WORLD.
AND BY THE WAY, ANOTHER REAL WORLD, JUST ONE QUICK REAL
WORLD, THE GALAXY NOTE 2 AND GALAXY S III, APPLE ADMITS, YOU
KNOW, DIDN'T INFRINGE TWO OF THE PATENTS, THE KEYBOARD AND
SLIDE TO UNLOCK.
10
THOSE TWO PHONES -- AND KEN, CAN I HAVE SLIDE 21 -- THOSE
11
TWO PHONES SOLD MORE THAN ALL OTHER PHONES COMBINED THAT ARE
12
ACCUSED IN THIS CASE.
13
THEY CLAIM ARE INFRINGING, THE LARGER SAMSUNG'S SALES.
14
DOESN'T MAKE SENSE.
15
HARDWARE AND INNOVATION AND HARD WORK.
THE FEWER THE NUMBER OF PATENTS THAT

THAT
SAMSUNG'S SUCCESS IS BECAUSE OF ITS

THIS IS A MADE UP CASE.
16
AND NOW I'LL LET MR. NELSON TALK TO YOU ABOUT THAT.
17
(MR. NELSON GAVE HIS CLOSING ARGUMENT ON BEHALF OF THE
18
DEFENDANTS.)
19
MR. NELSON:
20
JURORS:
21
MR. NELSON:
GOOD MORNING, EVERYBODY.
GOOD MORNING.
SO YOU MIGHT HAVE GUESSED THAT I'D BE
22
TALKING TO YOU ABOUT THE PATENTS.
I'VE HAD THE OPPORTUNITY,
23
OVER THE LAST MONTH, TO TALK TO A LOT OF THE WITNESSES ABOUT
24
THE PATENTS, BUT I HAVEN'T HAD A CHANCE TO TALK TO YOU YET
25
ABOUT THE PATENTS AND THAT'S WHAT I'M GOING TO DO HERE.
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THESE FIVE PATENTS -- IF WE COULD PUT BACK UP SLIDE 18,

MR. KOTARSKI -- I WANT TO TALK ABOUT THESE PATENTS.
AND BEFORE I GET INTO THIS, I WANT TO CLEAR UP ONE THING
THAT APPLE COUNSEL SAID.
NUMBER OF INVENTORS ON THESE PATENTS TO TESTIFY.
THAT NUMBER IS ONE.
HE TOLD YOU THAT THEY BROUGHT IN A
THAT'S WHO CAME IN.
HE TOLD YOU THEY
BROUGHT IN MR. MILLET AND MR. DENIAU AND ONE OTHER GENTLEMAN,
MR. GARCIA.
NONE OF THOSE PEOPLE -- YOU'LL HAVE THE PATENTS
BACK THERE.
LOOK.
NONE OF THOSE PEOPLE ARE NAMED INVENTORS ON
10
THOSE PATENTS.
11
WITNESS, MR. CHRISTIE.
12
ON THE '721 PATENT.
13
THEY BROUGHT TO YOU ONE, THAT WAS THEIR SECOND

THAT WAS IT.
AND HE'S A NAMED INVENTOR
THAT'S ALL.
SO THE -- THAT MEANS THERE'S 14 -- THERE WERE 14 TOTAL.
14
THAT'S 13 APPLE PEOPLE THAT DIDN'T COME AND TESTIFY TO YOU.
15
OTHER THAN THE '721 PATENT, YOU HAVEN'T HEARD FROM ANY OF THEIR
16
FOLKS.
17
SO
SO LET ME TELL YOU FIRST, BECAUSE YOU'VE HEARD A LOT ABOUT
18
WHAT APPLE DOESN'T WANT YOU TO DO, BUT LET ME TELL YOU WHAT YOU
19
ARE HERE TO DO.
20
AND IF WE COULD PUT UP JURY INSTRUCTION 18.
21
NOW, YOU'VE HEARD, AND WE'VE HEARD THROUGHOUT THIS CASE,
22
THAT THE COURT DETERMINED THAT ONE OF THE PATENTS, THE '172
23
PATENT, WITH CERTAIN MODELS WAS INFRINGED.
24
HASN'T BEEN A SECRET.
25
WE KNOW THAT.
THAT
APPLE HAS SAID THAT OVER AND OVER AGAIN.
BUT YOU KNOW WHAT THAT MEANS?
THE OTHER FOUR PATENTS, THE
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COURT DECIDED THAT'S UP TO YOU.
AND THAT'S RIGHT HERE IN THE INSTRUCTION.
THAT'S UP TO YOU TO DECIDE,
AND YOU KNOW WHAT ELSE THE COURT SAID IS ALL FIVE OF THE
PATENT CLAIMS ON THE VALIDITY, THAT'S UP FOR YOU -- UP TO YOU
TO DECIDE.
SO, LOOK, APPLE KEEPS TELLING YOU, THEY'VE DONE IT WITH A
NUMBER OF WITNESSES, THE PATENT OFFICE ALREADY LOOKED AT THESE
THINGS.
RIGHT?
YOU CAN'T SECOND GUESS THE PATENT EXAMINER.
BUT THAT'S JUST NOT THE WAY THE SYSTEM WORKS.
IN FACT,
10
YOU KNOW HOW OUR GOVERNMENT -- WE HAVE CHECKS AND BALANCES.
11
WHEN ONE BRANCH DOES SOMETHING, WE HAVE SOMEBODY ELSE THAT
12
CHECKS IT.
13
THAT'S EXACTLY WHAT THE JURY SYSTEM IS WITH RESPECT TO
14
PATENTS, RIGHT?
15
TO HELP OUT THE PATENT OFFICE.
16
THAT'S WHAT YOU'RE SUPPOSED TO DO.
YOU'VE GOT
THE PATENT OFFICE DOESN'T HAVE THE OPPORTUNITY TO HEAR
17
FROM US THE OTHER SIDE OF THE STORY.
THEY DON'T HAVE THE
18
OPPORTUNITY TO SEE ALL THE ART.
19
I'M GOING TO TALK TO YOU ABOUT THAT THE PATENT OFFICE NEVER SAW
20
ANY OF THESE THINGS.
THERE'S THREE OF THESE PATENTS
21
AND THEN THE OTHER TWO PATENTS WHERE COUNSEL KIND OF BEAT
22
ME UP WHERE COUNSEL SAID THE PATENT OFFICE SAW THIS, THEY NEVER
23
SAW THE COMBINATION THAT WE PRESENTED.
24
25
AND FURTHERMORE, THERE WAS NOBODY THERE TO PRESENT THE

OTHER SIDE OF THE STORY.
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SO YOU WON'T GET A JURY INSTRUCTION -- YOU CAN GO BACK AND
LOOK IN THERE.
OF THEM WILL SAY, OH, DEFER TO THE PATENT OFFICE.
SOMETHING THAT WAS IN FRONT OF THE PATENT OFFICE, DON'T GIVE IT
CONSIDERATION.
BECAUSE THAT'S NOT THE LAW.
GO LOOK THROUGH THOSE JURY INSTRUCTIONS.
DON'T LOOK AT IT.
NONE
IF THERE WAS
THERE'S NO SUCH INSTRUCTION
AND, IN FACT, IT'S NOT JUST HER HONOR THAT HAS SAID THAT.
WE SAW -- REMEMBER THIS PATENT VIDEO AT THE VERY BEGINNING OF
THE CASE WHERE THERE WAS, LIKE, AN INTRODUCTION INTO THE PATENT
10
SYSTEM?
11
THAT OF COURSE WE NEED THIS SYSTEM BECAUSE THE PATENT OFFICE
12
MAKES MISTAKE.
13
WELL, JUDGE FOGEL WAS THE GENTLEMAN THERE AND HE SAID
THINGS ARE OVERLOOKED.
SO IT'S VERY IMPORTANT, LADIES AND GENTLEMEN, THAT YOU
14
CONSIDER THE EVIDENCE THAT I'M GOING TO WALK THROUGH AND
15
PRESENT TO YOU, NOT SIMPLY LISTEN TO WHAT APPLE IS TELLING YOU
16
AND DON'T GIVE IT ANY CREDENCE.
17
DO.
18
THAT'S WHAT I'M ASKING YOU TO
THAT'S WHAT THIS CASE IS ABOUT.
WE'RE ENTITLED TO COME
19
HERE AND DEFEND OURSELVES WHEN WE'RE ACCUSED.
20
JUST SAY, WHATEVER YOU SAY, APPLE.
21
AND PRESENT OUR CASE, AND THAT'S EXACTLY WHAT WE'VE DONE, AND
22
WHEN YOU GO BACK INTO THAT ROOM WHEN I WALK YOU THROUGH THIS
23
EVIDENCE, THAT'S ALL I CAN ASK YOU TO DO IS CONSIDER WHAT I'VE
24
PRESENTED TO YOU.
25
WE DON'T HAVE TO
WE'RE ENTITLED TO COME IN
SO LET'S ALSO LOOK AT JURY INSTRUCTION NUMBER 24, AND THIS
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I WANT TO CLEAR UP A LITTLE BIT BECAUSE IT MIGHT BE A LITTLE
BIT CONFUSING.
3
4
5
6
YOU KNOW, YOU'VE HEARD A LOT OF TALK ABOUT THE IPHONE AND
PEOPLE LOOKING AT THE IPHONE.
NOW, MR. PRICE HAS ALREADY ADDRESSED THAT, THAT THESE
PATENTS AREN'T IN, I MEAN, THE IPHONE FOR THE MOST PART.
BUT -- OH, I HAVE A LASER POINTER NOW.
SO -- BUT THAT'S NOT INFRINGEMENT -- THAT'S NOT HOW YOU
9
10
11
12
13
DEAL WITH INFRINGEMENT AND INVALIDITY.

PRODUCT TO THE PRODUCT.
AND, IN FACT, WE KNOW WE COULDN'T BECAUSE THE IPHONE

DOESN'T PRACTICE MOST OF THESE PATENTS.
IT'S THE CLAIMS OF THE PATENTS THAT MATTER, AND IT'S EVERY
14
WORD HERE THAT MATTERS.
15
DON'T GET TO READ THINGS OUT.
16
KIND OF CLOSE.
17
YOU DON'T COMPARE THE
RIGHT?
WHEN WE'RE LOOKING AT INFRINGEMENT, WE

RIGHT?
WE DON'T SAY, AH, THAT'S
THAT'S NOT THE WAY IT WORKS.
AND THE OTHER THING THAT'S IMPORTANT IS WHEN WE TURN
18
AROUND AND WE LOOK AT THE PRIOR ART AND WE'RE COMPARING THE
19
PRIOR ART TO THE PATENT CLAIMS, WE DON'T PUT NEW WORDS IN.
20
RIGHT?
21
IMPORTANT.
22
THROUGH THIS EVIDENCE, BECAUSE I THINK APPLE IS TRYING TO PLAY
23
IT BOTH WAYS.
24
25
IT'S GOT TO BE THE SAME BOTH WAYS, AND THAT'S VERY

THAT'S A THEME THAT YOU'RE GOING TO SEE AS I WALK
SO LET ME FIRST TALK ABOUT THIS ANALYZER SERVER PATENT.

THAT'S THE '647 PATENT.
THAT'S WHERE WE LEFT OFF YESTERDAY, SO
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I FIGURED THAT WOULD BE FRESHEST IN EVERYBODY'S MIND AND LET'S
PICK UP THERE.
NOW, THERE ARE TWO INDEPENDENT REASONS THAT I'M GOING TO
GIVE YOU WHY THESE DEVICES DON'T INFRINGE, AND I'M GOING TO
WALK YOU THROUGH THAT EVIDENCE.
THINGS, BUT I WANT TO OUTLINE TWO FOR YOU HERE TODAY, AND I'M
GOING TO TALK ABOUT ONE PRIOR ART REFERENCE ABOUT WHY THAT'S
INVENTIVE.
WE PRESENTED ADDITIONAL
I WON'T WALK YOU THROUGH THE JURY VERDICT FORM.
10
MR. MCELHINNY ALREADY DID THAT.
11
APPARENT THAT WHERE HE SAYS TO SAY YES, I SAY NO.
12
WHERE HE SAYS NO, I SAY YES.
13
HE -- I MEAN, IT'S PROBABLY

RIGHT?
(LAUGHTER.)
14
MR. NELSON:
NOW, LET'S TALK ABOUT THIS ANALYZER
15
SERVER, OKAY?
16
REQUIRED, AN ANALYZER SERVER FOR DETECTING STRUCTURES IN THE
17
DATA.
18
THAT'S A LIMITATION OF THE CLAIM.
IT'S
NOW, YOU REMEMBER, THROUGH THIS CASE, IT REALLY SEEMED
19
LIKE APPLE WAS TRYING TO READ THAT LIMITATION OUT OF THE CLAIM.
20
THEY WERE TRYING TO GIVE IT NO MEANING, ANALYZER SERVER, IT'S
21
JUST A PIECE OF SOFTWARE.
22
BUT THE COURT GAVE US A CONSTRUCTION YESTERDAY MORNING
23
YOU'LL RECALL.
AND ANALYZER SERVER MEANS SOMETHING, AND IT
24
MEANS SOMETHING VERY IMPORTANT.
25
SEPARATE FROM THE CLIENT THAT RECEIVES DATA HAVING STRUCTURES
IT'S "A SERVER ROUTINE
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FROM THE CLIENT."

SO WE KNOW THAT TO HAVE AN ANALYZER SERVER, YOU'VE GOT TO
HAVE AT LEAST TWO THINGS.
SERVER, AND YOU'VE GOT TO HAVE A CLIENT, AND THE TWO OF THEM
HAVE TO BE SEPARATE.
WHAT SERVER MEANS, ANALYZER SERVER MEANS.
RIGHT?
RIGHT?
BECAUSE YOU'VE GOT TO HAVE A
THAT'S WHAT THE COURT SAYS THAT'S
SO LET'S TALK ABOUT WHAT WE HEARD ABOUT THAT.
WE BROUGHT
IN THE FOLKS THAT ACTUALLY WROTE THAT CODE.
DISCUSSION ABOUT THE FRAMEWORK CODE AND THE SHARED LIBRARIES.
10
YOU RECALL SOME
MS. HACKBORN FROM GOOGLE, SHE CAME RELATIVELY EARLY ON OUR
11
SIDE OF THE CASE, SHE ACTUALLY WROTE THAT LINKIFY CODE, AND WE
12
ASKED HER, DID YOU IMPLEMENT IT AS A SERVER?
13
NO, I DIDN'T.
14
IT WASN'T IMPLEMENTED AS A SERVER, AND SHE TOLD YOU WHY
15
THAT WAS.
16
APPLICATIONS.
17
IT'S BECAUSE IT DIDN'T NEED TO SHARE DATA ACROSS
NOW, WHO ELSE DID WE HEAR FROM ABOUT THIS SHARED LIBRARY
18
ISSUE?
19
HIM INTO COURT TO TESTIFY.
20
RIGHT?
21
WELL, HERE IS ONE OF THE INVENTORS.
APPLE DIDN'T BRING
WE SHOWED YOU HIS DEPOSITION.
WE SHOWED YOU THAT DEPOSITION TESTIMONY.
AND COUNSEL REFERENCED THIS DX EXHIBIT 334.
THAT'S THAT
22
SERIES OF E-MAILS WE TALKED ABOUT A FEW TIMES.
I WANT YOU TO
23
GO BACK AND LOOK AT THAT AND I WANT YOU TO READ THAT VERY
24
CAREFULLY.
25
READ THAT DOCUMENT, WHICH IS WHY I PUT THAT DOCUMENT INTO
I'M NOT AFRAID OF THOSE DOCUMENTS, BECAUSE WHEN YOU
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EVIDENCE, YOU'LL SEE SOMETHING VERY, VERY IMPORTANT, WHICH IS
THAT AT THE TIME APPLE FILED THIS PATENT, OKAY -- THIS IS
FEBRUARY OF 1996 -- THE ONLY THING THAT THEY HAD EVER
COMPLIMENTED -- OR IMPLE -- CONTEMPLATED, THAT'S THE WORD I WAS
LOOKING FOR, IS IMPLEMENTING THIS AS A SERVER.
FIRST CLASS APPLICATION, AND THAT MEANS SOMETHING THAT CAN
STAND ALONE, RIGHT, BE BY ITSELF.
8
9
10
11
THEY CALL IT A
AND, SURE, LATER THERE WAS TALK, BECAUSE IF YOU LOOK

THROUGH THOSE E-MAILS, THERE WAS SOME TALK ABOUT SOME PROBLEMS
WITH PERFORMANCE BECAUSE OF OVERHEAD AND ISSUES LIKE THAT.
SO NOW THERE WAS, MUCH LATER, A DIFFERENT PROPOSAL THAT
12
WAS MADE, MAYBE WE SHOULD ELIMINATE AND WE SHOULD BUILD THAT
13
FUNCTIONALITY INTO THE APPLICATION ITSELF.
14
BE THE SHARED LIBRARY.
15
16
17
RIGHT?
THAT WOULD
BUT IF YOU LOOK AT WHEN THAT'S SUGGESTED, THAT IS EIGHT

MONTHS AFTER THE PATENT IS FILED.
RIGHT?
EIGHT MONTHS AFTER.
THIS PATENT CLAIMS AN ANALYZER SERVER.
IT DOESN'T TALK
18
ABOUT SHARED LIBRARIES.
19
FUNCTIONS THAT ARE REQUIRED HERE OF THE ANALYZER SERVER IN THE
20
APPLICATION ITSELF.
21
IT DOESN'T TALK ABOUT IMPLEMENTING THE
THE FACT THAT THE INVENTORS MAY LATER HAVE DECIDED, WELL,
22
THERE'S SOME PROBLEMS WITH THAT, SO MAYBE I'M GOING TO TRY TO
23
CHANGE IT, THAT'S VERY IMPORTANT BECAUSE THAT -- ONE, WE KNOW
24
IT CAN'T MAKE ITS WAY INTO THE PATENT BECAUSE THE PATENT WAS
25
FILED EIGHT MONTHS BEFORE.
RIGHT?
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THE SECOND THING WE KNOW IS IT ISN'T IN THE PATENT.
RIGHT?
AN ANALYZER SERVER.
THE APPLICATION ITSELF.
THIS IS WHERE THE WORDS BECOME VERY IMPORTANT.
IT SAYS
IT DOESN'T SAY PUT THAT FUNCTIONALITY IN

RIGHT?
IT'S VERY, VERY IMPORTANT, LADIES AND GENTLEMEN, SO GO
BACK AND LOOK AT THAT AND CONSIDER THAT TESTIMONY THAT WE
PRESENTED TO YOU FROM DR. BONHURA.
8
9
APPLE DIDN'T BRING TO YOU ONE SINGLE INVENTOR FOR THE '647
PATENT.
NOBODY CAME IN HERE AND SAT IN THAT STAND AND TOLD YOU
10
WHAT THIS INVENTION WAS ABOUT AND HOW THEY CAME UP WITH IT,
11
WHAT IT WASN'T AND WHAT IT WASN'T.
12
SO WHO ELSE DID WE HEAR FROM ABOUT THIS?
CERTAINLY WE
13
HEARD FROM SAMSUNG'S EXPERT, RIGHT, AND HE EXPLAINED EXACTLY
14
WHAT I JUST DESCRIBED TO YOU, THAT THIS LIBRARY CODE THAT
15
THEY'RE ACCUSING OF INFRINGEMENT, IT'S NOT JUST PART OF THE
16
APPLICATION.
17
IT IS THE APPLICATION.
WHO ELSE DID WE HEAR FROM?
RIGHT?
WE -- THIS IS YESTERDAY.
18
YOU'LL RECALL ME ASKING APPLE'S EXPERT ABOUT THIS LINKIFY,
19
THAT'S THE SHARED LIBRARY THAT THEY'RE ACCUSING IN THE
20
MESSENGER APPLICATION, AND HE ADMITS THAT IT CAN'T RUN AS A
21
STANDALONE APPLICATION, RIGHT?
22
23
IT CAN'T RUN BY ITSELF.
SO THERE'S NOTHING SEPARATE -- REMEMBER WHAT HE SAID?
AND
I ASKED HIM VERY -- WHAT IS THE CLIENT?
24
WELL, THAT'S THE MESSENGER APPLICATION.
25
WHAT IS THE -- THE MESSENGER APPLICATION WITH THE BROWSER,
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YOU KNOW, WE HAD THE BROWSER APPLICATION.
HE SAID.
APPLICATION.
4
5
6
7
8
9
10
11
RIGHT?
THAT'S WHAT
AND HE FREELY ADMITTED, THOSE ARE ONE SINGLE
SO WE KNOW FROM THE COURT'S CONSTRUCTION, WE NEED TWO

SEPARATE THINGS.
RIGHT?
WE HAVE ONE.
TWO SEPARATE THINGS.
THEIR EXPERT SAYS THERE'S JUST ONE THING,
THE ONE APPLICATION.

AND WHAT GOOGLE DID HERE, AND WHAT'S BEEN DONE WITH THESE,
IS TO PUT THE FUNCTIONALITY IN THE APPLICATION, ELIMINATE THE
OVERHEAD, DON'T USE AN ANALYZER SERVER.
SO -- AND THINK ABOUT IT, LADIES AND GENTLEMEN.
DOES IT
12
REALLY MAKE SENSE?
13
THE TRIAL, THEY'RE TRYING TO READ NO MEANING INTO THE ANALYZER
14
SERVER, BUT WE HAVE A CONSTRUCTION THAT SAYS WE NEED TWO
15
SEPARATE THINGS.
16
17
18
19
WE HAVE A CONSTRUCTION NOW -- THROUGHOUT
SO WHAT'S YOUR ANSWER TO THAT?
WELL, I POINTED TO THE ONE
THING, THE APPLICATION.

BUT REALLY, IF YOU LOOK IN THERE, I COULD KIND OF PULL IT
APART AND THAT WOULD BE TWO SEPARATE THINGS.
20
IT DOESN'T MAKE ANY SENSE.
21
NOW, THE OTHER REASON I WANT TO TALK TO YOU ABOUT -- THIS
22
IS TIED TO THE COURT'S CONSTRUCTION AS WELL -- THIS LINKING
23
ACTIONS TO DETECTED STRUCTURES, AND YOU HEARD, IN HIS FIRST
24
TIME AROUND FROM SAMSUNG'S EXPERT, ABOUT WHY THE ACTION
25
PROCESSOR LIMITATION WASN'T MET BECAUSE THERE WERE NO LINKED
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ACTIONS TO DETECTED STRUCTURES.
I MEAN, WE SEE HERE THE ACTION PROCESSOR FOR PERFORMING
THE SELECTED ACTION LINKED TO THE SELECTED STRUCTURE, MEANING
IT'S GOT TO BE WHAT THE ANALYZER SERVER LINKS TO THAT DETECTED
STRUCTURE.
RIGHT?
AND IN ANDROID -- REMEMBER, WE HEARD FROM MS. HACKBORN,
ONCE AGAIN, THAT ANDROID WAS DESIGNED VERY DIFFERENTLY, WITH
THIS INTENTS SYSTEM.
BEGINNING, AND THAT WAS TO MAKE IT FLEXIBLE, RIGHT, SO THAT YOU
THIS IS AN IDEA SHE HAD FROM THE
10
COULD BRING WHATEVER APPLICATION YOU WANTED.
11
THESE SPECIFIED CONNECTIONS MADE.
12
13
14
THAT WAS A DESIGN CHOICE.
YOU WOULDN'T HAVE
RIGHT?
IT WAS WHAT THEY WANTED.
BECAUSE, REMEMBER, IT'S AN OPEN PLATFORM.
RIGHT?
SO FOR THAT REASON -- AND DR. JEFFAY CAME IN AND EXPLAINED
15
TO YOU WHY THAT WAS DIFFERENT.
16
ACTION -- OR EXCUSE ME -- YOU PUT, SAY, AN E-MAIL IS A GOOD
17
EXAMPLE BECAUSE YOU MIGHT HAVE A CORPORATE E-MAIL AND YOU MIGHT
18
HAVE A PERSONAL E-MAIL, SO YOU TOUCH ON AN E-MAIL ADDRESS, AND
19
ONE OF THE THINGS YOU MIGHT WANT TO DO IS SEND.
20
YOU CAN SELECT, YOU KNOW, AN
WELL, YOU KNOW, YOU HAVE THOSE THINGS AND IT'S GOING TO
21
ASK YOU, WHICH ONE DO YOU WANT?
22
BECAUSE IT'S FLEXIBLE.
23
SO THERE IS NO SPECIFIED CONNECTION.
24
25
AND PART OF THAT REASON IS
YOU CAN RUN THE APPLICATIONS YOU WANT.
WHAT'S APPLE'S RESPONSE TO THAT?
I DON'T KNOW BECAUSE I
DIDN'T UNDERSTAND ANYTHING THAT THEIR EXPERT WAS SAYING
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YESTERDAY.
CODE AND SAID THIS DOES THIS AND THIS CALLS THIS.
EXPLAINED TO US IN ENGLISH WHY THAT WAS THE CASE, WHY IS THERE
A SPECIFIED CONNECTION.
5
6
7
8
9
I DIDN'T UNDERSTAND IT.
HE TALKED ABOUT A BUNCH OF
SO ONCE AGAIN, THIS IS APPLE'S BURDEN OF PROOF, LADIES AND

GENTLEMEN, AND THEY DIDN'T EXPLAIN IT TO YOU.
WE DID.
WE EXPLAINED TO YOU WHY IT'S NOT THERE.
IT'S NOT
THERE.
SO IF YOU FIND EITHER OF THOSE REASONS, THEN YOU FIND IN
10
OUR FAVOR.
11
OR THE OTHER, BECAUSE EVERYTHING MATTERS.
12
HE NEVER
RIGHT?
I DON'T HAVE TO PROVE BOTH.
IT'S JUST ONE
SO NOW I WANT TO TALK ABOUT THE PRIOR ART THAT WE BROUGHT
13
WITH RESPECT TO THIS PATENT, AND YOU'LL RECALL THAT WE BROUGHT
14
MR. LARS FRID-NIELSEN, THE GENTLEMAN FROM DENMARK WHO DESIGNED
15
THIS SYSTEM.
16
YEARS BEFORE THE PATENT CAME OUT.
17
AND THIS SYSTEM, REMEMBER, WAS 1985.
THAT'S 11
AND APPLE, YOU KNOW, THEY SAY, WELL, WAIT A MINUTE, THIS
18
DOESN'T DO A FEW THINGS, ONE OF THE THINGS BEING THE POP-UP
19
MENU WHICH I'LL ADDRESS IN A MOMENT.
20
21
22
ANOTHER THING IS, WELL, IT DOESN'T DETECT MULTIPLE

STRUCTURES.
REMEMBER THEY SAID THAT?
WELL, WE KNOW FROM THIS THAT WE'RE LOOKING AT HERE,
23
DX 332, THE -- THERE ARE DIFFERENT STRUCTURES HERE, DIFFERENT
24
TYPES OF PHONE NUMBERS BECAUSE ONE HAS A PARENTHESES AROUND IT
25
AND ANOTHER ONE JUST HAS THE DASHES.
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AND YOU'LL RECALL, WHEN YOU LOOKED AT THE CODE, HOW
APPLE'S EXPERT -- REMEMBER, THEY PUT THAT CODE UP FROM THE
SIDEKICK CODE AND IT HAD SET 1 AND ONE PATTERN AND IT HAD SET 2
IN ANOTHER PATTERN AND SET 3, AND HE SAID, OH, THOSE ARE ALL
ONE PATTERN.
WELL, THEY'RE NOT.
THEY'RE DIFFERENT PATTERNS.
RIGHT?
AND THAT'S THE POINT, BECAUSE AS THAT TESTIMONY THAT I
POINTED OUT TO YOU YESTERDAY FROM THEIR EXPERT, HE ACTUALLY
DEFINED, THE FIRST TIME HE CAME UP ON THE STAND, AND SAID EVERY
10
TIME WE HAVE A DIFFERENT PATTERN, YOU'VE GOT A DIFFERENT
11
STRUCTURE.
12
13
14
RIGHT?
SO THERE ARE MULTIPLE STRUCTURES.
WHAT'S THE OTHER THING THEY SAID?
WELL, THE OTHER THING
THEY SAID IS, WELL, IT DOESN'T DO MULTIPLE ACTIONS.

BUT WE KNOW FROM THE CONSTRUCTION THAT THE COURT GAVE US,
15
THAT'S NOT REQUIRED.
16
THAT CONSTRUCTION UP.
17
CONSTRUCTION.
IT'S AT LEAST ONE.
RIGHT?
AND I CAN PUT
THIS IS THE LINKING ACTIONS
18
WE'LL PUT THAT BACK ON THE SCREEN, PLEASE.
19
SEE, CREATING A SPECIFIED CONNECTION BETWEEN EACH DETECTED
20
STRUCTURE -- EXCUSE ME -- AND AT LEAST ONE COMPUTER SUBROUTINE.
21
RIGHT?
22
ACTIONS, YOU HAVE MULTIPLE STRUCTURES, YOU HAVE AN ACTION
23
LINKED TO ONE STRUCTURE, YOU HAVE AN ACTION LINKED TO ANOTHER
24
STRUCTURE, YOU HAVE ACTIONS.
25
ABOUT THEY HAVE TO BE DIFFERENT TYPES OF ACTIONS.
IT DOESN'T SAY MULTIPLE ONES BECAUSE YOU CAN HAVE
RIGHT?
THERE'S NOTHING IN HERE
THERE'S NONE
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OF THAT.
NOW, THE LAST THING THAT APPLE TALKS ABOUT IS THIS POP-UP
MENU.
POP-UP MENU.
RIGHT?
AND THEY SAID, WELL, THERE'S NOTHING IN THE
BUT, REMEMBER, THIS WAS 1985.
RIGHT?
1985.
AND SIDEKICK
ITSELF, AS WE DEMONSTRATED TO YOU, HAD POP-UP MENU IN IT.
JUST DIDN'T USE IT FOR THIS DIALER FUNCTIONALITY.
8
9
SO THINK ABOUT THIS, LADIES AND GENTLEMEN:
IT
APPLE'S
BASICALLY SAYING, WELL, SIDEKICK HAD ONE, RIGHT, STRUCTURED
10
ACTION.
11
PLACES, BUT IT DIDN'T DO THEM WITH RESPECT TO THE MENU THAT
12
SHOWS YOU THE ACTION.
13
IT DIDN'T HAVE TWO.
SIDEKICK DID POP-UP MENUS OTHER
THEY NEVER BROUGHT TO YOU AN INVENTOR TO SAY, HEY, WAIT A
14
MINUTE, THIS IS WHY IT WAS HARD TO DO TWO AND NOT ONE.
15
SOMEBODY ELSE ALREADY DID ONE.
16
DO TWO.
17
18
19
RIGHT?
THIS WAS WHY IT WAS HARDER TO
THEY DIDN'T BRING YOU SOMEBODY TO SAY, EUREKA, THAT'S WHAT

I WAS WORKING ON.
THEY DIDN'T BRING TO YOU SOMEBODY, ONE OF THE INVENTORS
20
THAT SAID, HEY, WAIT A MINUTE, THIS IS WHY IT WAS HARD TO
21
IMPLEMENT THIS AS A POP-UP MENU.
THEY NEVER DID THAT.
22
SO LADIES AND GENTLEMEN, THAT'S THE PATENT OFFICE.
23
NOW I WANT TO MOVE TO THE '959 PATENT, AND SOMEBODY IS
24
GOING TO -- THE CLAIMS ARE ALWAYS GOING TO BE UP HERE BECAUSE,
25
ONE, I WANT TO REFERENCE THEM AND, TWO, THEY'RE VERY IMPORTANT
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BECAUSE THAT'S WHAT WE'RE HERE FOR.
SO HERE, ON THE '959 PATENT, THIS IS THE HEURISTICS TO
LOCATE INFORMATION.
PATENT IS.
YOU'LL RECALL, RIGHT, THAT'S WHAT THIS
AND HERE'S WHAT I WANT TO FOCUS ON.
THERE'S TWO THINGS
THAT I'M GOING TO WALK THROUGH HERE TODAY AND GIVE YOU THE MAP.
I'M GOING TO WALK THROUGH WHY THERE'S NO INFRINGEMENT, BECAUSE
THERE IS NO HEURISTIC, THAT THERE'S NO HEURISTIC TO LOCATE
10
AND I'M ALSO GOING TO WALK YOU THROUGH THE WAIS PRIOR ART,
THE FREEWAIS SF PRIOR ART.
13
14
OKAY?
AND SO FIRST, BEFORE I DO THAT, I SHOULD REMIND YOU,

SIDEKICK, PATENT OFFICE DIDN'T HAVE IT.
15
16
THAT'S NOT THERE IN THE
ACCUSED GOOGLE SEARCH APPLICATION.
11
12
RIGHT?
FREEWAIS PRIOR ART?
THE PATENT OFFICE DIDN'T HAVE IT.
NO
DISPUTE ABOUT THAT.
17
NOW, LET'S GO TO THE NEXT SLIDE, MR. KOTARSKI.
18
NOW, HERE I JUST WANT TO REMIND YOU A LITTLE BIT, THIS WAS
19
TRUE WITH THE LAST PATENT I TALKED ABOUT, THE '647, AND IT'S
20
TRUE WITH THE '959 PATENT.
21
COUNSEL ABOUT THE IPHONE, 2007, THIS WAS WHERE EVERYTHING CAME
22
FROM.
23
24
25
YOU'VE HEARD A LOT FROM APPLE'S
WELL, WE'VE ALREADY SEEN THAT MOST OF THESE PATENTS AREN'T

USED IN THE IPHONE.
BUT WE ALSO KNOW THE '647, 1996, THERE'S NO IPHONE AROUND.
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THIS HAS NOTHING TO DO WITH THE IPHONE.
WE ALSO KNOW -- AS MR. PRICE SAID, YOU DIDN'T HEAR ONE
SHRED OF EXPERT TESTIMONY.
STRUCTURE OF THE CODE FROM THE '647.
DIDN'T HEAR ONE WORD FROM THEIR EXPERT ABOUT HOW APPLE DOES IT.
RIGHT?
CASE.
TELL US.
WE HEARD ALL ABOUT THE CODE AND THE

DO YOU RECALL THAT?
YOU
YOU DON'T HAVE ANY BASIS TO CONCLUDE THAT THAT'S THE

I'M NOT SURE WHY.
I DON'T KNOW WHY THEY DIDN'T WANT TO
NOW LET'S TALK ABOUT THIS '959 PATENT.
AGAIN, IF YOU LOOK
10
AT THAT PATENT, IT DOESN'T TALK ABOUT MOBILE PHONES, MOBILE
11
DEVICES.
12
WHAT THIS IS FOR.
IT TALKS ABOUT DESKTOP COMPUTERS.
RIGHT?
THAT'S
13
AND LET ME -- IF YOU GO TO THE NEXT SLIDE -- MAKE ONE
14
THING VERY CLEAR, BECAUSE THIS IS IMPORTANT BECAUSE I THINK
15
COUNSEL FOR APPLE REALLY CONFUSED THIS SEVERAL TIMES DURING HIS
16
CASE, PARTICULARLY DURING THE OPENING STATEMENT.
17
YOU'LL RECALL WHERE THEY SHOWED ONE OF THE PHONES AND
18
SAID, WAIT, SOMEBODY IS TYPING IN AND THERE'S INFORMATION
19
COMING FROM THE INTERNET AND LOCALLY, THE CONTACTS.
20
RECALL THAT VIDEO.
21
YOU'LL
WELL, IT'S VERY IMPORTANT WHAT THEY'RE NOT ACCUSING.
THIS
22
IS APPLE'S EXPERT, AND I ASKED HIM FLAT OUT, "YOU'RE NOT
23
ACCUSING THE FUNCTIONALITY OF THE GOOGLE SEARCH SERVER; RIGHT?
24
"I THINK THAT'S FAIR."
25
HE AGREES.
SO THE GOOGLE SEARCH SERVER, THAT'S NOT
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APPLE'S INFRINGEMENT CLAIM.
WITH IT.
THAT DOESN'T HAVE ANYTHING TO DO
THAT'S VERY IMPORTANT, BECAUSE WHAT IS IT THAT LOCATES THE
INFORMATION ON THE INTERNET?
IT'S THE GOOGLE SEARCH SERVER.
WHAT'S GOOGLE?
IT SHOULD COME AS NO SURPRISE.
WHAT HAS GOOGLE BEEN DOING FOR THE LAST --
SINCE 1997 WHEN THEY WERE FOUNDED?
BUT THAT'S NOT ACCUSED.
SO WHAT IS ACCUSED?
10
THAT'S WHAT GOOGLE DOES.
LET'S GO TO THE NEXT SLIDE.
MR. BRINGERT CAME, THIS IS THE GENTLEMAN FROM GOOGLE WHO
11
WROTE THIS GOOGLE SEARCH APPLICATION, OR HEADED THE TEAM TO
12
WRITE THIS GOOGLE SEARCH APPLICATION, AND HE EXPLAINED -- HE
13
DID THIS DRAWING.
14
WE'VE HIGHLIGHTED IT AS THIS YELLOW BOX.
15
SEARCH SERVER.
16
WHAT'S ACCUSED IS RIGHT HERE IN THE MIDDLE.
REMEMBER, NOT ACCUSED.
WHAT DOES THIS YELLOW BOX DO?
17
18
GOOGLE SEARCH SERVER THAT DOES THAT.
19
RIGHT?
WELL, IT DOESN'T LOCATE
THAT'S FOR SURE.
MR. BRINGERT TOLD US WHAT IT DOES.

BLENDS RESULTS.
THAT'S THE
HE SAID THIS BLENDS
20
RESULTS.
21
SOME RESULTS, SOMEBODY FOUND SOMETHING, SOMEBODY LOCATED
22
SOMETHING FOR ME, AND THIS BLENDS RESULTS.
23
REMEMBER?
HERE IS THE GOOGLE
WELL, THAT'S NOT LOCATING.
IN OTHER WORDS, I HAVE
THAT'S NOT WHAT THE CLAIM
24
SAYS.
IT SAYS "HEURISTICS TO LOCATE INFORMATION IN A PLURALITY
25
OF LOCATIONS," ONE OF THEM BEING THE INTERNET.
RIGHT?
IT
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DOESN'T SAY, OH, TO BLEND INFORMATION TOGETHER THAT SOMEBODY
ELSE FOUND FOR ME.
LET HIM READ THAT LIMITATION OUT OF THE CLAIM.
4
5
THAT'S NOT WHAT THE CLAIM IS, AND YOU CAN'T
BUT HOW DOES APPLE'S EXPERT ACTUALLY DO THAT?

WAS INTERESTING.
WELL, THIS
THIS WAS SOME QUESTIONING FROM MR. PAK.
IF YOU GO BACK AND YOU'RE GOING TO LOOK -- AND I NEED TO
EXPLAIN A LITTLE BIT ABOUT THIS.
AT THE '959 PATENT, YOU'LL
SEE THERE'S SOMETHING DESCRIBED IN THAT '959 PATENT THAT'S
CALLED GLOBAL HEURISTICS, OKAY?
THAT'S SOMETHING DIFFERENT
10
THAN A PLURALITY OF HEURISTICS THAT'S IN THE CLAIM.
11
GLOBAL HEURISTICS, THEY DO SOME OTHER THINGS, BUT THAT'S NOT
12
PART OF THE CLAIM IN THE PATENT.
13
THESE
AND WE SEE HERE FROM APPLE'S EXPERT, HE SAYS EXACTLY THAT.
14
THE GLOBAL HEURISTICS, AS WE'VE DESCRIBED, DO A DIFFERENT THING
15
THAN THE PLURALITY OF HEURISTIC MODULES, RIGHT?
16
AND IF WE LOOK FURTHER HERE, WHAT DID HE SAY?
THAT GLOBAL
17
HEURISTICS MAY, AS WE DISCUSSED, FUSE, ORDER, THAT SORT OF
18
THING, THE RESULTS.
19
WELL, WHAT'S FUSE?
THAT'S BLEND, RIGHT?
20
SO HE SAID, APPLE'S EXPERT, HE SAID FLAT OUT IN HIS
21
DEPOSITION THAT THIS -- THAT BLENDING THAT THEY ACCUSED ISN'T
22
ONE OF THESE PLURALITY OF HEURISTICS IN THE CLAIM.
23
24
25
BUT HE CAME IN HERE TO COURT AND HE TOLD YOU SOMETHING

ELSE.
RIGHT?
HE TOLD YOU SOMETHING ELSE.
SO YOU'VE GOT TO CONSIDER THAT WHEN YOU GO BACK THERE.
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2
3
NOW, SO APPLE DOESN'T PRACTICE THIS CLAIM.
THE ACCUSED
ANDROID PHONES, SAMSUNG PHONES, DON'T PRACTICE THIS CLAIM.

BUT WE SHOWED YOU SOMETHING THAT DID, AND THAT'S THE WAIS
SYSTEM, SO LET ME JUST REMIND YOU A LITTLE BIT ABOUT THIS WAIS
SYSTEM.
THIS WAIS SYSTEM WAS THE UNIVERSAL SEARCH SYSTEM THAT WAS
DEVELOPED BY A COUPLE GENTLEMEN WHO WE BROUGHT IN TO TESTIFY --
I'LL TALK ABOUT THAT IN A MINUTE -- BUT YOU'LL SEE HERE THIS IS
THE UNIVERSAL SEARCH BOX.
10
CODE WAS.
11
IN GEORGE, AND WHAT CAME BACK FROM THE LOCAL MACHINE IS, YOU
12
KNOW, GEORGE ADAMS.
13
YOUR LOCAL MACHINE.
14
RIGHT?
THIS IS A DEMONSTRATION OF WHAT THIS
THIS IS THE UNIVERSAL SEARCH BOX.
YOU TYPE
HE MIGHT BE A CONTACT THAT YOU HAVE IN
AND HERE WHAT CAME BACK IS GEORGE WASHINGTON.
OKAY?
15
THOSE WERE PAPERS ABOUT GEORGE WASHINGTON THAT ARE OUT ON THE
16
INTERNET.
17
18
19
AND THEN THERE'S A RANKING THAT'S OVER THERE, THAT

HEURISTIC RANKING THAT WAS DESCRIBED FOR YOU.
SO WHAT DOES APPLE -- FIRST OF ALL, APPLE SAYS THAT WE'RE
20
PLANNING TO SHOW THAT BECAUSE WE BROUGHT TO YOU SOME GENTLEMEN
21
THAT ARE NOT FROM THE UNITED STATES.
22
WELL, BREWSTER KAHLE, RIGHT -- AND LET ME PUT UP SLIDE
23
22 -- HIS NAME IS RIGHT HERE ON THE CODE.
24
BROUGHT HIM FOR YOU.
25
RIGHT?
THAT'S WHY WE
REMEMBER, THIS WAS OPEN SOURCE CODE,
SO HE DEVELOPED THE FIRST VERSION AND HE DESCRIBED FOR
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2
YOU WHAT THAT IS.

NOW, OTHER PEOPLE BUILT ON THAT.
MR. PFEIFER IS THE ONE
WHO DID THE VERSION THAT WE TALKED ABOUT.
YES, THAT DOES SEARCH LOCALLY AND REMOTE AT THE SAME TIME.
5
6
7
8
9
WE TALKED -- GO FORWARD TO MR. KAHLE.
RIGHT?
AND HE SAID,
HE SAID IT USES
HEURISTICS, RIGHT, TO DO THAT.

SO THOSE GENTLEMEN CAME IN AND THEY TESTIFIED TO YOU ABOUT
WHAT THEIR PRODUCTS DID.
NOW, WHAT'S APPLE'S RESPONSE TO THAT?
WELL, APPLE SAYS A
10
FEW THINGS.
11
EVEN CONSIDER THIS AS PRIOR ART BECAUSE IT WASN'T IN THE
12
UNITED STATES.
13
THEIR FIRST RESPONSE IS, WAIT A MINUTE, YOU CAN'T
REMEMBER THAT?
WELL, THAT'S NOT RIGHT.
WE JUST HEARD THAT.

THAT'S NOT RIGHT AT ALL.
THEY
14
SAID THERE WAS NO EVIDENCE, THAT WE HAD NO EVIDENCE THAT IT WAS
15
INSTALLED HERE IN THE UNITED STATES.
16
IF YOU GO BACK AND YOU LOOK HERE -- THIS IS DX 313, THAT'S
17
AN EXHIBIT YOU HAVE -- THIS WAS AN E-MAIL THAT MR. PFEIFER
18
PRODUCED THAT SHOWS ALL THE INSTALLATIONS IN THE UNITED STATES.
19
I'VE HIGHLIGHTED THAT THERE.
20
AT THAT.
21
YOU GO AHEAD AND GO BACK AND LOOK
NOW, WHAT ELSE DID APPLE SAY?
WELL, THEIR SECOND THING IS
22
APPLE SAID, WAIT A MINUTE, SOURCE CODE, THAT'S NOT
23
INSTRUCTIONS.
24
25
SEE, THE CLAIM SAYS CONTAINING PROGRAM INSTRUCTIONS.

LET ME JUST EXPLAIN THIS TO YOU.
IT'S A COMPUTER READABLE
AND
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MEDIUM, MEANING, YOU KNOW, SOMETHING THE COMPUTER CAN READ,
HARD DISK, WHATEVER, RIGHT, THAT CONTAINS THESE PROGRAM
INSTRUCTIONS.
SO THE PROGRAM INSTRUCTIONS ARE THE SOURCE CODE THAT
DR. RINARD TALKED TO YOU ABOUT AND SAID THIS IS THE 1996
VERSION, I DIDN'T CHANGE ONE LINE OF CODE.
THAT?
8
9
10
11
12
APPLE NEVER CHALLENGED THAT.
DO YOU REMEMBER
THEY NEVER SAID, WELL, WAIT
A MINUTE, HE CHANGED THIS CODE.

BUT APPLE NOW SAYS, THEIR EXPERT SAYS, WELL, WAIT A
MINUTE, SOURCE CODE CAN'T BE PROGRAM INSTRUCTIONS.
INTERESTING.
WHAT THEY'RE SAYING IS, WAIT A MINUTE, IF
13
IT'S INSTRUCTIONS THAT PEOPLE CAN ACTUALLY READ AND GET
14
SOMETHING FROM IT, IT'S NOT PRIOR ART.
15
16
BUT IF YOU ACTUALLY COMPILE IT, IT IS, EVEN THOUGH PEOPLE

CAN'T READ IT.
17
THAT DOESN'T MAKE ANY SENSE.
18
YOU KNOW WHAT ELSE DOESN'T MAKE ANY SENSE?
BEFORE THIS
19
CASE, APPLE AGREED -- YOU'RE GOING TO HAVE THIS IN YOUR
20
GLOSSARIES.
21
ABOUT SOME TERMS THAT MIGHT COME UP IN THE CASE AND WHAT THE
22
PARTIES AGREED TO.
23
24
25
YOU HAVE A LITTLE GLOSSARY IN YOUR JURY BINDERS
WELL, LOOK AT THIS ONE.

AGREED TO.
HERE'S A DEFINITION THAT APPLE
SOURCE CODE, WRITTEN INSTRUCTIONS FOR A COMPUTER.
SO I DON'T KNOW WHAT APPLE'S EXPERT IS TALKING ABOUT.
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RIGHT?
FOR A COMPUTER.
APPLE'S ALREADY AGREED THOSE ARE WRITTEN INSTRUCTIONS
WHAT'S THE THIRD THING THEY SAY?
WELL, THE THIRD THING
THEY SAY IS, WAIT A MINUTE, ALL OF THE THINGS THAT ARE IN HERE
HAVE TO BE LOCATED ON THE LOCAL DEVICE.
THAT?
REMEMBER THEY SAID
AND THEY SAID, WHAT YOU POINT TO, DR. RINARD, IS A
HEURISTIC FOR FINDING INFORMATION ON THE INTERNET THAT'S NOT ON
THE LOCAL MACHINE.
10
WELL, FIRST OF ALL, THIS IS JUST THE INSTRUCTIONS.
11
REMEMBER, THIS ISN'T A METHOD CLAIM.
12
TO DO ANYTHING.
13
DOING THAT.
14
YOU DON'T ACTUALLY HAVE
YOU JUST HAVE TO HAVE THE INSTRUCTIONS FOR
RIGHT?
THAT'S WHAT'S IMPORTANT.
THE SECOND THING IS THERE'S NOTHING IN THIS CLAIM -- THIS
15
IS ANOTHER SITUATION WHERE APPLE'S ADDING THINGS TO THE CLAIM.
16
THERE'S NOTHING IN HERE THAT SAYS, OH, WAIT A MINUTE, I NEED TO
17
HAVE ALL OF THAT INFORMATION ON ONE DEVICE AND, LOOK, ONE OF
18
THE THINGS IS THE INTERNET.
19
20
21
SO UNDER APPLE'S LOGIC, THE INTERNET HAS TO BE ON THE

LOCAL DEVICE.
IT DOESN'T MAKE ANY SENSE.
NOW, WHAT'S THE THIRD THING HE SAID?
WELL, THE THIRD
22
THING HE SAID IS SAMSUNG'S EXPERT, DR. RINARD ON THIS, DIDN'T
23
IDENTIFY A PLURALITY OF HEURISTICS.
24
LAWYER WORD THAT MEANS TWO OR MORE, RIGHT?
25
"PLURALITY" IS JUST A
SO -- BUT HE CAME BACK ON REBUTTAL AND HE POINTED OUT
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THAT, YES, ABSOLUTELY I DID.
HEURISTICS, THE HEURISTIC RELEVANCE RANKING, STEMMING, AND
SYNONYMS, HE POINTED THOSE OUT.
THE SOURCE CODE FOR THE THREE
RIGHT?
NOW, REMEMBER, THAT WAS TOWARDS THE END BEFORE WE HAD THE
OVERTIME, THE ADDITIONAL DAY OF TESTIMONY, AND APPLE'S COUNSEL
NEVER CHALLENGED THAT.
OUT OF, WE HAVE 15 MINUTES LEFT, YOUR HONOR, WE'RE JUST GOING
TO GIVE THEM TO THE COURT.
QUESTION.
10
11
12
THEY STILL HAD -- THEY MADE A BIG DEAL
THEY NEVER ASKED HIM A SINGLE
THEY NEVER CHALLENGED THIS.
THEY NEVER SAID, WELL,
WAIT A MINUTE, YOU'RE NOT RIGHT.

SO YOU'VE GOT TO THINK ABOUT THAT WHEN YOU'RE GOING BACK
THERE AND WEIGHING THE EVIDENCE.
13
NOW I WANT TO MOVE TO THE '414 PATENT.
14
THE '414 PATENT -- SOMEBODY IS GOING TO GET THE CLAIM AND
15
16
17
18
PUT IT UP HERE.
AGAIN, THE '414 PATENT, THAT'S WHAT APPLE KEEPS CALLING
THE BACKGROUND SYNC PATENT.
AND I'M GOING TO TALK ABOUT TWO THINGS, AND I'M GOING TO
19
TALK ABOUT THEM IN THE REVERSE ORDER HERE BECAUSE I DO THINK
20
IT'S IMPORTANT.
21
SO THIS WASN'T THE FIRST BACKGROUND SYNCING DEVICE.
22
SHOWED YOU THAT.
23
REMEMBER THAT, THAT MICROSOFT HAD DONE BEFORE.
24
25
WE
WE SHOWED YOU THE WINDOWS MOBILE M.E.,
SO THIS ISN'T JUST ABOUT BACKGROUND SYNCING.
IT'S ABOUT A
VERY SPECIFIC ARCHITECTURE, AS YOU HEARD DURING THIS CASE, FOR
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BACKGROUND SYNCING, AND WHEN I WALK THROUGH WHAT APPLE SAYS TO
TRY TO GET AROUND THE PRIOR ART, YOU'RE GOING TO SEE HOW VERY
SPECIFIC IT IS, AND THAT SPECIFIC ARCHITECTURE IS SOMETHING
THAT SAMSUNG DOES NOT USE.
SO LET'S GO FIRST TO WHAT APPLE TOLD YOU IN OPENING
STATEMENT ABOUT WHAT THIS INVENTION IS.
THEY SAID, IT ALLOWS
THE PHONE TO DO IT AT THE SAME TIME, MEANING SYNCING, SO THAT
THE USER IS NEVER DISRUPTED AND NEVER UNDERSTANDS ACTUALLY THAT
THE SYNCING IS HAPPENING IN THE BACKGROUND.
10
WELL, WHAT WERE THEY IMPLYING TO YOU?
THEY WERE IMPLYING
11
TO YOU THAT WITHOUT THIS PATENT, THIS INVENTION, THIS IS
12
BACKGROUND SYNCING.
13
IT'S THE SAME THING WHEN THEY SHOWED YOU MR. LOCKHEIMER'S
14
TESTIMONY.
15
SAID IT WAS IMPORTANT.
16
YOU RECALL THAT TESTIMONY?
WELL, BACKGROUND SYNCING MAY BE.
THEY SAID, OH, LOOK, HE
BUT NOBODY EVER SAID,
17
AND APPLE DIDN'T TELL YOU, OURS IS A REALLY SPECIFIC WAY OF
18
DOING IT.
19
RIGHT?
MR. LOCKHEIMER TALKED -- WHEN HE WAS TALKING ABOUT THAT,
20
HE SAID, YEAH, THIS IS -- YOU KNOW, I WORKED AT THIS COMPANY,
21
GOOD, BACK IN THE 2000S AND IT WAS AN E-MAIL COMPANY AND THAT
22
WAS IMPORTANT TO US, THOSE KINDS OF THINGS.
23
24
25
SO DON'T BE DISTRACTED, LADIES AND GENTLEMEN.
THIS CLAIM
IS VERY SPECIFIC.
AND LET'S WALK THROUGH THAT.
SO WHAT DID APPLE'S EXPERT
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SAY WHEN I ASKED HIM THESE QUESTIONS?
DOING BACKGROUND SYNCING?
HE VERY QUICKLY SAID, NO, NO, NO,
THIS IS A PARTICULAR WAY.
RIGHT?
AND THEN SHORTLY THEREAFTER, HE TOLD US WHAT IT WAS.
YOU'VE GOT TO HAVE THREE.
A FEW TIMES.
DID IT COVER ALL WAYS OF
REMEMBER THAT?
WE TALKED ABOUT THAT
WITH CLAIM 25, THE WAY THIS IS, AND ALL THE PARTIES AGREE,
YOU'VE GOT -- ONE OF MY FINGERS HAS BEEN BROKEN A FEW TIMES,
WHEN I HOLD IT UP, IT DOESN'T WORK VERY WELL, SORRY -- I'LL USE
10
THIS HAND -- YOU HAVE GOT TO HAVE THREE OF THESE
11
SYNCHRONIZATION SOFTWARE COMPONENTS, RIGHT, NOT TWO.
12
OF THOSE THREE HAS TO BE FOR A DIFFERENT CLASS OF DATA.
13
EXAMPLES WE'VE BEEN USING WERE E-MAIL, CONTACTS, CALENDAR.
14
RIGHT?
15
TALKING ABOUT WHEN WE SAY A CLASS.
AND EACH
THE
IT'S JUST A DIFFERENT DATABASE IS WHAT WE'RE REALLY
16
SO WE KNOW THAT THAT'S VERY PARTICULAR.
17
WE DON'T DO IT.
18
BUT WINDOWS MOBILE M.E. DOES, AND LET ME SHOW YOU THAT
19
VIDEO THAT WE PLAYED JUST TO REMIND YOU OF WHAT'S GOING ON, AND
20
I'M GOING TO TALK ABOUT THIS, WHAT'S GOING ON.
21
22

MR. NELSON:
WE'VE GOT TWO DEVICES HERE THAT ARE
23
TALKING TO EACH OTHER, AND HERE SOMEBODY IS MAKING A CONTACT,
24
PUTTING IN -- AKIN ANDERSON I THINK IS WHAT IT'S GOING TO TURN
25
OUT TO BE.
YOU SEE HE'S WORKING ON THAT, TYPES IN A PHONE
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2
3
4
NUMBER, AND SAYS OKAY.

SO HE SENT THAT, RIGHT?
BASICALLY, YOU KNOW, OKAY, I WANT
TO SYNC.
AND NOW OVER HERE WHAT'S GOING ON ON THIS OTHER DEVICE,
HE'S GOING THROUGH THE INTERFACE, GOING THROUGH HIS CONTACTS
AND SAYING, WELL, YEAH, LOOK, I'M LOOKING AT THIS, I'M LOOKING
AT THAT.
8
9
10
AND WE SEE UP HERE THAT LITTLE TOWER STARTS BECOMING

ACTIVE, SO THAT MEANS IT'S SYNCING, AND THERE YOU GO,
AKIN ANDERSON.
11
SO THE WINDOWS M.E., WE KNOW IT CAN DO EXACTLY WHAT APPLE
12
SHOWED YOU WITH THE ACCUSED DEVICES IN THEIR OPENING STATEMENT.
13
SO THIS RIGHT HERE, AS WE WALKED THROUGH, IT HAS THE
14
ARCHITECTURE, THIS VERY SPECIFIC ARCHITECTURE OF CLAIM 20.
15
SO WHAT DOES APPLE SAY IN RESPONSE?
AND THIS IS
16
IMPORTANT.
17
IT'S DX 317 WHEN YOU GO BACK THERE -- THIS DESCRIBES THE
18
WINDOWS MOBILE M.E. ARCHITECTURE, AND YOU SEE THESE THREE BOXES
19
UP THERE, E-MAIL, CONTACTS, AND CALENDAR.
20
YOU RECALL HE CAME AND TESTIFIED.
21
THE PROVIDERS THAT CORRESPONDED TO THE THREE SYNCHRONIZATION
22
SOFTWARE COMPONENTS.
23
IN FACT, IN THIS DOCUMENT YOU WANT TO LOOK AT --
THAT WAS DR. CHASE,
THIS IS WHAT HE SAID WERE
WELL, WHAT DID APPLE'S EXPERT SAY?
HE ACTUALLY SAID IN
24
EACH ONE OF THOSE ARE, INDEED, THE SYNCHRONIZATION, SOFTWARE
25
SYNCHRONIZATION COMPONENTS AND THEY ARE, INDEED, CONFIGURED TO
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SYNCHRONIZE THOSE PARTICULAR DATA CLASSES.
2
3
SO HE AGREES, WINDOWS MOBILE M.E., IT HAS THAT SPECIFIC

ARCHITECTURE.
4
5
6
7
8
9
10
THERE'S NO DISPUTE THERE.
BUT WHAT DOES HE SAY?
WELL, I'VE LOOKED AT THE SOURCE
CODE.
AND, IN FACT, DR. CHASE EVEN TESTIFIED IN HIS TESTIMONY
THAT NONE OF THOSE PROVIDE A THREAD.
SO WE HEARD SOMETHING WE NEVER HEARD IN THE INFRINGEMENT
CASE, WELL, WAIT A MINUTE, THOSE DON'T PROVIDE A THREAD.
SO NOW THAT BECOMES THE ONLY DISTINCTION HE'S MAKING FOR
11
THIS PRIOR ART REFERENCE, IT DOESN'T PROVIDE A THREAD.
12
SAID, WELL, DR. CHASE AGREED.
13
14
15
AND HE
INTERESTING, BECAUSE I LISTENED TO DR. CHASE AND I DIDN'T

HEAR THAT.
SO WHAT DID DR. CHASE ACTUALLY SAY?
HE'S TALKING ABOUT
16
THESE PROVIDERS, THEY'RE ILLUSTRATED THERE, AND THESE
17
SYNCHRONIZATION SOFTWARE COMPONENTS, AND THEY PROVIDE THE
18
SYNCHRONIZATION SOFTWARE PROCESSING THREADS I SPOKE ABOUT.
19
I DON'T KNOW WHAT HE'S TALKING ABOUT.
WHAT IS APPLE'S
20
EXPERT TALKING ABOUT?
21
AGREED AND SAID, OH, THESE DON'T PROVIDE A THREAD.
22
23
24
25
HE TRIED TO TELL YOU THAT DR. CHASE
BUT YOU CAN SEE THE TESTIMONY RIGHT HERE.
HE EXPLICITLY
SAID THEY DO PROVIDE A THREAD.

NOW -THE COURT:
I'M SORRY TO INTERRUPT YOU, BUT IT'S
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12:02.
CAN WE GO AHEAD AND TAKE OUR LUNCH BREAK?
MR. NELSON:
THE COURT:
YES, YOUR HONOR.

OKAY.
THANK YOU.
WHY DON'T WE COME BACK
AT -- WE HAVE A LOT OF PEOPLE TODAY, SO IT MAY GET CONGESTED.
WHY DON'T WE COME BACK AT 1:10?
6
7
8
9
10
11
12
13
14
15
16
17
OKAY?

BACK AT 1:10.
WE'LL SEE YOU
THANK YOU.

THE COURT:
COURTROOM.
OKAY.
WHY DON'T I JUST GIVE YOU YOUR TIME TOTALS?
APPLE AS USED 1 HOUR AND 31 MINUTES, SO YOU HAVE 29

MINUTES LEFT.
SAMSUNG HAS USED 1 HOUR AND 7 MINUTES, SO YOU HAVE 53
MINUTES LEFT.
ALL RIGHT.
THANK YOU.
MR. NELSON:
LET'S TAKE OUR LUNCH BREAK.
(LUNCH RECESS WAS TAKEN FROM 12:03 P.M. TO 1:07 P.M.)
18
19
20
21
22
23
24
25
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3301
1
2
AFTERNOON SESSION
3
4
THE COURT:
HAVE THE PARTIES STIPULATED TO THE
EXHIBITS?
MS. MAROULIS:
MS. KREVANS:
THE COURT:
THE COURT:
ALL RIGHT.
MR. NELSON:
12
THE COURT:
THANK YOU.
OKAY.
WELCOME BACK.
PLEASE TAKE A SEAT.
I AM, YOUR HONOR.

ALL RIGHT.
TIME IS 1:09.
PLEASE GO
AHEAD.
14
15
OKAY.
ARE YOU READY, MR. NELSON?
11
13
YES, YOUR HONOR.
9
10
YES, YOUR HONOR.
MR. NELSON:
OKAY.
GREAT, THANK YOU.
SO LET'S PICK UP RIGHT WHERE WE LEFT OFF.
WE WERE
16
TALKING ABOUT THE ONLY DISTINCTION THAT APPLE RAISED WITH THE
17
WINDOWS M.E. PRIOR ART, AND THAT WAS THIS IDEA OF PROVIDING A
18
THREAD.
19
FIGURE OUT WHAT APPLE'S EXPERT WAS TALKING ABOUT.
20
WE LOOKED AT THE TESTIMONY, BUT LET'S SEE IF WE CAN
NOW, IF WE GO TO THE NEXT SLIDE, I THINK WE HAVE A LITTLE
21
BIT OF INSIGHT HERE.
WHAT APPLE'S EXPERT HAS DONE IS TO CHANGE
22
THE DEFINITION OF WHAT IT MEANS TO PROVIDE A THREAD, AND HE DID
23
IT IN A WAY THAT WAS INCONSISTENT WITH WHAT HE SAID AT HIS
24
DEPOSITION.
25
DISTINCTION.
THAT'S THE ONLY WAY THAT HE RAISES THIS
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1
MR. PAK ASKED HIM A QUESTION, "ARE YOU SAYING THAT
PROVIDING A THREAD IS THE SAME THING WAS CREATING A THREAD,
SIR?
YES OR NO?"
"YES, SIR, I'VE SAID THAT, AND I'LL SAY IT AGAIN."
BUT THEN WE SHOWED HIM HIS DEPOSITION TESTIMONY, AND YOU
SEE HERE -- I'LL PICK UP TOWARDS THE BOTTOM -- THAT "YOU SAY
THAT THE WORD 'PROVIDING' IN CLAIM 11 REQUIRES CREATING A
THREAD; IS THAT FAIR?
"ANSWER:
I SAY IT REQUIRES PROVIDING THE THREAD, WHICH IS
10
THE PLAIN LANGUAGE INTERPRETATION.
11
MEAN BY 'CREATE.'
12
I'M NOT QUITE SURE WHAT YOU
I MEAN, TECHNICALLY THERE IS NO CREATE."
SO WHEN WE GET TO TRIAL, THE ONLY DISTINCTION THAT HE
13
RAISES -- HE FIRST TELLS YOU THAT DR. CHASE DIDN'T SAY IT, AND
14
WE JUST SAW THAT HE DID, AND THE NEXT THING HE SAID IS HE
15
PROVIDES A DEFINITION OF WHAT IT MEANS TO PROVIDE A THREAD
16
THAT'S DIRECTLY CONTRADICTORY TO WHAT HE SAID AT HIS
17
DEPOSITION, AND THAT'S THE ONLY DISTINCTION THAT APPLE RAISED
18
AT THIS TRIAL WITH RESPECT TO THAT WINDOWS MOBILE M.E. PRIOR
19
ART.
20
SO LET ME TALK ABOUT WHY THIS PATENT IS NOT INFRINGED, BUT
21
I FIRST WANT TO ADDRESS SOMETHING THAT APPLE'S COUNSEL
22
ADDRESSED IN OPENING JUST TO CLEAR -- EXCUSE ME -- IN CLOSING,
23
WE'RE AT THE END NOW, BECAUSE HE LEFT SOMETHING OUT HERE.
24
25
YOU RECALL THAT HE SHOWED YOU THIS AND SAID, LOOK, IT TOOK
TWO YEARS FOR GOOGLE TO DEVELOP THIS BACKGROUND SYNCING.
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WELL, WHAT WAS GOING ON BETWEEN THIS -- REMEMBER, THIS,
YOU HEARD TESTIMONY ABOUT THIS, THIS 2008 ANDROID 1.0 RELEASE,
THAT'S A FULL RELEASE.
WORKING.
THAT WAS ON A PHONE, EVERYTHING
SO FROM 2006 TO 2008, THEY WEREN'T JUST WORKING ON
BACKGROUND SYNCING.
THE ENTIRE OPERATING SYSTEM, THE PLATFORM, THE FRAMEWORK, ALL
THE THINGS YOU HEARD ABOUT THAT ARE GOING ON IN THERE.
9
10
11
RIGHT?
THEY WERE WORKING ON DEVELOPING
THE OTHER THING THAT WAS LEFT OFF WAS HERE'S WHERE THE
'414 PATENT COMES IN, 2010.
SO THIS IS WAY AFTER THE FACT.
NOW, LET'S TALK ABOUT THIS NON-INFRINGEMENT.
SO YOU'LL
12
RECALL THAT -- IF WE GO TO THE NEXT SLIDE, MR. KOTARSKI --
13
YOU'LL RECALL THIS IS -- THESE ARE THE SYNC ADAPTERS THAT WE'RE
14
ACCUSED OF, AND WHAT'S GOING ON HERE IS THEY'RE TRYING TO DO A
15
LITTLE MISDIRECTION.
16
BECAUSE THEY'RE CALLED SYNC ADAPTERS, THEY SAY, OH, OKAY,
17
SYNC ADAPTERS, THEREFORE, THEY MUST DO THE SYNCHRONIZATION.
18
BECAUSE, REMEMBER, THAT'S WHAT THE CLAIM REQUIRES.
19
SYNCHRONIZATION SOFTWARE COMPONENT IS CONFIGURED TO SYNCHRONIZE
20
STRUCTURED DATA.
21
RIGHT?
RIGHT?
WELL, AS WE SHOWED YOU FOR FOUR OF THESE, AND FOR ALL OF
22
THEM IN THE MAIL DATA CLASS, THERE ARE NO SUCH THINGS.
23
THAT'S NOT WHAT THEY DO.
24
25
AND WE BROUGHT YOU MR. WESTBROOK.
RIGHT?
HE'S THE GENTLEMAN THAT
HEADED UP THE GROUP THAT ACTUALLY DID THIS WORK.
RIGHT?
AND
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HE MADE THIS DRAWING AND HE SHOWED YOU, AND IT'S THIS LITTLE
YELLOW BOX AGAIN THAT THEY'RE ACCUSING.
THAT'S THE SYNC ADAPTER.
WE HIGHLIGHTED IT.
BUT LOOK WHAT IT'S NOT CONNECTED TO.
IT'S NOT CONNECTED
TO THE DATABASE AND IT'S NOT CONNECTED TO THE GMAIL SERVER.
DOESN'T SYNCHRONIZE ANYTHING.
ACCESS TO THOSE THINGS.
IT CAN'T.
IT DOESN'T HAVE
AND MR. WESTBROOK EXPLAINED TO YOU WHY THAT WAS.
WE USED A DIFFERENT ARCHITECTURE BECAUSE WE WANTED TO DO IT
10
11
12
13
FASTER.
RIGHT?
WE WANTED THE APPLICATION TO BE FASTER.
SO IT WASN'T JUST THAT IT WASN'T THERE.
IT WAS THAT THERE
WAS A SPECIFIC TECHNICAL REASON FOR IT.

AND WITH RESPECT TO THOSE EXCHANGE SYNC ADAPTERS, HE SAID
14
THE SAME THING.
15
WE WANT TO BE FASTER.
16
IT
NO, IT'S NOT THAT.
WE WANT TO PUSH E-MAIL.
WE USE THE EXCHANGE SERVICE.
WE DON'T USE THESE EXCHANGE SYNC ADAPTERS IN ORDER TO DO
17
THE SYNCHRONIZATION OF THE STRUCTURED DATA, WHICH IS WHAT THE
18
CLAIM REQUIRES.
19
SO WHAT DOES APPLE'S EXPERT SAY IN RESPONSE?
WELL, YOU'LL
20
RECALL THIS.
21
DISCUSSION ABOUT THAT.
22
THAT I'VE IDENTIFIED SYNCHRONIZATION COMPONENTS THAT CAUSE THE
23
SYNCHRONIZATION TO OCCUR, ABSOLUTELY."
24
25
WHAT HE SAYS IS, "WELL, I THINK THERE WAS SOME
REMEMBER THAT?
I WANT TO BE CLEAR, IT'S MY POSITION
HE SAID THAT CAUSE THE SYNCHRONIZATION TO
OCCUR.
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WELL, YOU'LL SEE BOTH PLACES, WHICH IS CONFIGURED TO
SYNCHRONIZE HERE IN CLAIM 11, WHEREIN THE SYNCHRONIZATION
SOFTWARE COMPONENT IS CONFIGURED TO SYNCHRONIZE, RIGHT, IS
CONFIGURED TO SYNCHRONIZE.
IT DOESN'T SAY "CAUSE."
IF MY SON CAME TO ME AND SAID, I SAID, SON, DID YOU DO
YOUR HOMEWORK, AND HE SAID, WELL, DAD, I CAUSED IT TO BE DONE,
THAT ANSWER WOULD SOUND STRANGE TO ME, AND IT SHOULD SOUND
STRANGE TO YOU HERE BECAUSE THAT'S NOT WHAT THIS CLAIM
REQUIRED.
10
SO HOW DO WE KNOW THAT'S NOT WHAT IT REQUIRED?
11
HAVE THIS.
12
FROM THE FILE WRAPPER AT PAGE 751.
13
THIS IS JX 8 THAT WE PUT INTO EVIDENCE.
AND YOU'LL
THIS IS
YOU'LL SEE THAT AT ONE TIME, APPLE DID HAVE A CLAIM THAT
14
SAID "CONFIGURED TO CAUSE RETRIEVAL AND STORAGE OF THE
15
STRUCTURED DATA," RETRIEVAL AND STORAGE, SYNCHRONIZING.
16
THAT'S WHAT YOU'RE DOING.
17
18
19
20
21
IT SAID THAT.
BUT THERE WAS PRIOR ART OUT THERE.
THEY COULDN'T HAVE
THAT CLAIM.
AND SO THEY TOOK IT OUT, AND NOW IT SAYS "CONFIGURED TO
SYNCHRONIZE."
SO IN ORDER TO TRY TO GET AROUND THE PRIOR ART IN THE
22
PATENT OFFICE, THEY TOLD THE PATENT OFFICE, NOT CAUSING.
23
RIGHT?
24
THE BARGAIN THEY STRUCK WITH THE PATENT OFFICE.
25
RIGHT?
THIS IS A DIRECT RELATIONSHIP.
TAKE IT OUT.
THAT'S
NOW THEY'RE COMING IN HERE AND THEY WANT TO SAY SAMSUNG'S
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1
2
PHONES, ANDROID CODE INFRINGES.

WHAT DO THEY DO?
RIGHT?
THEY WANT TO SAY THAT.
THEY TAKE IT -- THEY PUT IT BACK IN.
THEY CHANGED THE BARGAIN, RIGHT, BECAUSE THEY CAN'T GET
INFRINGEMENT WITHOUT REWRITING THE CLAIM.
BUT YOU CAN'T LET THEM DO IT.
YOU CAN'T LET THEM DO IT
BECAUSE THAT'S NOT WHAT THE PROCESS IS.
NOW THEY'VE GOT TO STICK WITH IT.
8
9
10
11
THEY STRUCK THIS DEAL.
SO NOW LET ME TURN TO THE '172 PATENT.
NOW, IN THE '172
PATENT, THIS IS THE ONE THAT THE COURT ALREADY FOUND INFRINGES.
YOU DON'T HAVE TO DEAL WITH THAT.
ONE THING THAT MIGHT NOT BE CLEAR FROM THIS WITH THE '172
12
PATENT IS FOR THE PHONES THAT ARE IN THIS CASE THAT HAVE BEEN
13
RELEASED SINCE SAMSUNG GOT NOTICE OF THAT PATENT -- THE NOTICE
14
WAS THE LAWSUIT, THAT'S FEBRUARY 8TH, 2012 -- THEY'RE NOT
15
ACCUSING THEM.
16
PHONES HAVE THE INFRINGING KEYBOARDS OR THE TABLET.
17
18
19
20
21
NOBODY SAYS -- APPLE DOESN'T SAY THAT THOSE
SO I JUST WANT TO MAKE THAT POINT CLEAR BECAUSE IT MAY NOT

HAVE BEEN CLEAR TO YOU WHEN WE WENT THROUGH THE CASE.
BUT LET ME TELL YOU WHY THAT CLAIM IS INVALID, AND LET ME
SHOW YOU HERE.
I WANT TO SHOW YOU THE ROBINSON PRIOR ART.
YOU'LL RECALL DR. WIGDOR, SAMSUNG'S EXPERT, CAME IN AND
22
WALKED THROUGH THIS ROBINSON REFERENCE AND TOOK YOU THROUGH
23
STEP BY STEP WITH RESPECT TO THE CLAIMS.
24
AND THE ONLY THING THAT WAS MISSING WAS THE IDEA, IF YOU
25
LOOK BEHIND FROM THIS FIGURE, WAS THAT WHEN YOU'RE TYPING, YOU
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PUT THE WORDS IN AT THE CURSOR.
TYPING IN AT THE CURSOR.
RIGHT?
YOU PUT WHAT YOU'RE
AND SO THAT WOULD BE THIS FIRST AREA, THE TOUCHSCREEN
DISPLAY THAT, THAT DISPLAYS A CURRENT CHARACTER STRING BEING
INPUT BY THE USER.
OKAY?
HE EXPLAINED THAT.
NOW -- BUT THAT WAS IT.
THAT WAS THE ONLY THING.
AND IF WE LOOK TO 96A, HE BROUGHT THE XRGOMICS PATENT UP,
RIGHT, AND SHOWED YOU, HERE'S A MOBILE DEVICE, HERE'S A MOBILE
DEVICE AND THIS IS ONE WHERE, AS IS COMMONLY KNOWN, YOU HAVE
10
THE CHARACTERS BEING INPUT.
11
SO WHAT'S APPLE'S RESPONSE TO THAT?
12
WELL, THE FIRST THING IS, WELL, THE PATENT OFFICE ALREADY
13
IT'S TWO-FOLD.
LOOKED AT THIS.
14
WELL, THEY DIDN'T LOOK AT THIS COMBINATION.
ALL THEY
15
TALKED ABOUT IS ROBINSON.
THERE'S NO EVIDENCE THAT THE PATENT
16
OFFICE LOOKED AT THIS COMBINATION OR THAT ANYBODY TOLD THEM,
17
HEY, YOU CAN COMBINE THESE THINGS TOGETHER.
18
WHAT'S THE OTHER THING THEY SAY?
WELL, WAIT A MINUTE,
19
NOBODY WOULD BECAUSE XRGOMICS IS A WORD SUGGESTION PATENT, NOT
20
A WORD CORRECTION PATENT.
21
THAT'S WHAT THEY SAID.
WHERE DOES IT SAY THAT?
IT DOESN'T SAY IT IN THE CLAIM.
22
THAT'S JUST SOMETHING THAT APPLE'S ADDED.
23
KNOW, WORD CORRECTION.
24
THAT.
25
WELL, THIS IS, YOU
THIS IS MISSPELLING.
IT DOESN'T SAY
AND YOU'LL SEE, IN THOSE JURY INSTRUCTIONS, COMBINING
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THINGS, IF THEY'RE IN THE SAME FIELD, RIGHT, IF THEY'RE
RELATED, THEN THOSE ARE KINDS OF THINGS THAT CAN BE COMBINED.
SO YOU'VE GOT TO CONSIDER THAT WHEN YOU GO BACK THERE.
AND THERE'S ANOTHER THING THAT'S IMPORTANT HERE.
APPLE
KEEPS SAYING DEFER TO THE PATENT OFFICE, DEFER TO THEM.
I'VE ALREADY TALKED ABOUT THAT.
AND
THAT'S NOT YOUR ROLE HERE.
BUT I'M GOING TO ILLUSTRATE HERE WHY IT'S REALLY
IMPORTANT, BECAUSE YOU'LL RECALL WHEN APPLE'S EXPERT WENT
THROUGH, RIGHT, HE UNDERLINED A WHOLE BUNCH OF THINGS.
10
TIME THE FIRST AREA WORD APPEARED, HE UNDERLINED IT.
11
DO YOU REMEMBER THAT?
12
EVERY
RIGHT?
BUT EACH TIME, I WAS VERY CAREFUL -- AND APPLE'S COUNSEL
13
ACTUALLY SAID THE SAME THING IN CLOSING -- THE REASON WHY HE
14
WAS UNDERLINING IT IS HE SAID, WELL, BECAUSE THE CHARACTERS
15
DON'T APPEAR IN THE FIRST AREA, THIS NEXT THING WON'T HAPPEN.
16
IT'S JUST CONFIRMING THAT THE ONLY THING MISSING IS THE
17
18
FACT THAT THE FIRST CHARACTERS.

SO APPLE -- THEY'RE LOOKING TO MAKE A LOT OF MONEY ON THIS
19
PATENT.
20
EVERYTHING ELSE, BUT WE DON'T PUT THE WORDS IN IT IN ROBINSON,
21
YOU KNOW, WHAT YOU'RE TYPING AT THE CURSOR, THAT SHOULD BE FOR
22
A PATENT.
23
IS THAT SO DIFFICULT?
24
25
THEY'RE SAYING BECAUSE, WAIT A MINUTE, ROBINSON HAS
THEY NEVER BROUGHT THE INVENTORS TO YOU AND SAID WHY

RIGHT?
AND IT IS PARTICULARLY IMPORTANT HERE BECAUSE REMEMBER AT

THE PATENT OFFICE, IT WAS JUST APPLE.
THEY COULD COME IN AND
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TELL THEM THE SAME THING, WELL, WAIT A MINUTE, THIS IS MISSING
AND THIS IS MISSING AND THIS IS MISSING, ALL BECAUSE THERE'S NO
CHARACTERS BEING TYPED AT THE FIRST AREA.
ANYBODY, LIKE US, TO RESPOND.
5
6
7
8
THERE WASN'T
RIGHT?
SO THAT'S VERY IMPORTANT THAT YOU CONSIDER THAT AND GO

BACK.
NOW I WANT TO MOVE TO THE LAST PATENT.
THIS IS THE '721
PATENT, SLIDE TO UNLOCK.
SO HERE -- FIRST I WANT TO SHOW YOU THE GALAXY NEXUS, AND
10
WE TALKED ABOUT THIS AND WHY THAT GALAXY NEXUS DOESN'T INFRINGE
11
THIS CLAIM.
12
THE WORDS OF THE CLAIM BECOME VERY IMPORTANT HERE.
SO YOU'LL SEE HERE THAT YOU HAVE TO MAKE CONTACT WITH AN
13
UNLOCK IMAGE, AND THEN YOU -- TO CONTINUOUSLY MOVE THE UNLOCK
14
IMAGE ON THE TOUCH SENSITIVE DISPLAY.
15
SAME WHEN YOU TOUCH, YOU MOVE IT.
16
17
18
BUT IF WE PLAY THE VIDEO OF THE GALAXY NEXUS, YOU'LL

RECALL THIS, THAT DOESN'T HAPPEN.
21
22
23
RIGHT?
19
20
IN OTHER WORDS, THAT
MR. NELSON:
YOU'LL SEE, THIS IS WHAT APPLE IS
CALLING THE UNLOCK IMAGE.

BUT WHEN THE GENTLEMAN TOUCHES IT, IT DISAPPEARS.
IT GOES
AWAY.
AND APPLE'S RESPONSE TO THAT IS, WELL, I HAVE SOMETHING IN
24
THE SPECIFICATION OF THE PATENT WHERE IT SAYS SOMETHING ON THE
25
UNLOCK IMAGE CAN APPEAR AND DISAPPEAR.
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3310
1
WELL, TWO THINGS WITH THAT.
ONE, AS WE WENT THROUGH, IT
DOESN'T SAY THE UNLOCK IMAGE CAN DISAPPEAR IN THE
SPECIFICATION.
IT'S SOMETHING ON IT.
AND THE OTHER THING IS WHAT'S IMPORTANT IS THE CLAIM.
CLAIM DOESN'T -- YOU DON'T COMPARE IT TO THE SPECIFICATION.
YOU COMPARE IT TO THE CLAIM, AND THE CLAIM SAYS THAT YOU NEED
TO CONTINUOUSLY MOVE THAT UNLOCK IMAGE.
SO IT DOESN'T INFRINGE FOR THAT REASON.
NOW LET ME TALK ABOUT INVALIDITY WITH RESPECT TO THIS
10
PATENT.
11
12
THE
I'M GOING TO FINISH UP HERE.
SO HERE WAS THE ONLY INVENTOR THAT WAS BROUGHT TO YOU, THE
ONLY INVENTOR THAT APPLE HAD, AND THAT WAS MR. CHRISTIE.
13
WELL, HE GAVE SOME INTERESTING TESTIMONY HERE.
HE SAID
14
WHY IT WAS THAT THEY DEVELOPED THEIR UNLOCK SCREEN, "WE WANTED
15
IT TO BE SOMETHING THAT WOULD BE REALLY UNLIKELY TO HAPPEN
16
ACCIDENTALLY."
17
THAT'S WHAT HE SAID.
RIGHT?
OKAY.
WELL, WE SHOWED YOU THE NEONODE PRIOR ART, THIS IS THE
18
PHONE, AND IT IS -- THE REASON FOR THE UNLOCKING, IT SAYS RIGHT
19
THERE IN THE REFERENCE -- AND YOU'LL HAVE THIS DX 342 THAT YOU
20
CAN LOOK AT BACK IN THE JURY ROOM -- IT SAYS TO MAKE SURE NO
21
UNINTENTIONAL CALLS ARE MADE, IN OTHER WORDS, EXACTLY THE SAME
22
REASON.
23
AND FURTHER, WHAT DOES IT SAY IN HERE?
WHAT HAPPENS WITH
24
IT?
YOU PRESS THE POWER BUTTON, JUST LIKE YOU WOULD ON ANY OF
25
THESE PHONES IN ORDER TO GET THE SCREEN TO COME ON, AND THEN
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3311
1
THE TEXT "RIGHT SWEEP TO UNLOCK" APPEARS ON THE SCREEN.
RIGHT.
3
4
SWEEP
THAT'S WHAT THEY SAY.
THAT'S WHAT THIS IS.
SO THE ONLY THING THAT WOULD BE
MISSING FROM THIS WOULD BE AN UNLOCK IMAGE.
THAT'S ALL.
WELL, WE SHOWED YOU PRIOR ART THAT HAS THAT UNLOCK IMAGE.
SPECIFICALLY, THE SLIDERS -- IF WE GO TO THE NEXT SLIDE -- THIS
IS FROM THE PLAISANT VIDEO THAT WE SHOWED YOU.
SLIDERS IN THE PRIOR ART.
RIGHT?
THERE'S
AND NOW LET'S GO TO THE THING THAT APPLE SHOWED YOU -- AND
10
THIS IS GOING TO ILLUSTRATE TO YOU WHY IT'S VERY IMPORTANT FOR
11
YOU TO BE A CHECK ON THIS AND NOT SIMPLY DEFER TO THE PATENT
12
OFFICE -- APPLE SHOWED YOU, DURING THEIR EXPERT'S TESTIMONY,
13
THIS FIRST PART FROM THE PLAISANT PAPER WHERE IT SAYS, OH, WE
14
WANT TOGGLES, THOSE ARE PREFERRED OVER SLIDES.
15
TEACHES AWAY FROM USING SLIDERS.
16
SO HE SAYS THAT
YOU'LL RECALL THAT TESTIMONY.
BUT RIGHT BELOW, WHAT THEY DIDN'T SHOW YOU, WHAT DOES IT
17
SAY?
18
USED THEM CORRECTLY IS ENCOURAGING SINCE MANY OTHER CONTROLS
19
CAN BE DESIGNED USING A SLIDING MOTION.
20
THE SLIDING MOTION IS THAT IT IS LESS LIKELY TO BE DONE
21
INADVERTENTLY."
22
"EVEN IF SLIDERS WERE NOT PREFERRED, THE FACT THAT USERS
ANOTHER ADVANTAGE OF
IN OTHER WORDS, EXACTLY THE SAME REASON FOR USING SLIDERS
23
THAT MR. CHRISTIE TESTIFIED TO OF WHY THEY CAME UP WITH THEIR
24
UNLOCK.
25
NOW, THE PATENT OFFICE DIDN'T, THEY DIDN'T -- NOBODY
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3312
1
POINTED THIS OUT TO THEM.
WE KNOW WHAT APPLE POINTED OUT TO YOU WHEN THEY CAME.
SO
TO THE EXTENT THAT THERE WAS A DISCUSSION WITH THE PATENT
OFFICE, WE CAN ONLY ASSUME THEY POINTED THEM TO THE SAME THING.
THAT'S VERY MISLEADING AND THAT'S WHY IT'S IMPORTANT FOR
YOU TO BE A CHECK, BECAUSE WE'RE HERE TO RESPOND.
TO BRING OUT THE INFORMATION ON THE OTHER SIDE OF THE STORY.
SO WITH THAT, I REALLY APPRECIATE YOUR ATTENTION.
WE'RE HERE
I KNOW
IT'S -- IT'S BEEN, YOU KNOW, A LONG, LONG CASE.
10
BUT THINK ABOUT IT WHEN YOU GO BACK IN THERE.
YOUR JOB IS
11
TO WEIGH THE EVIDENCE, RIGHT, TO WEIGH THE EVIDENCE YOU'VE
12
HEARD.
13
AND I'VE GIVEN YOU A ROADMAP FROM MY SIDE OF THE CASE.
14
AND THINK ABOUT WHO WE BROUGHT.
15
ACTUALLY WROTE THE SOFTWARE, THE GOOGLE ENGINEERS, MS. KIM.
16
THEY CAME IN.
17
18
WE SHOWED THAT.
WE BROUGHT IN THE PRIOR ARTISTS, TO THE EXTENT THAT WE

WERE RELYING ON PRIOR ART, WHO WROTE THAT SOFTWARE.
19
WHAT DID APPLE DO IN RESPONSE?
20
INVENTOR.
21
HERE.
22
WE BROUGHT THE PEOPLE THAT
APPLE BROUGHT IN ONE
THE OTHER 13, YOU DIDN'T HEAR THEM.
WHAT ELSE DID THEY DO?
THEY WEREN'T
THEY BROUGHT IN EXPERTS.
THAT'S
23
BASICALLY THEIR CASE.
YOU DON'T HEAR FROM THE PEOPLE WHO DO
24
IT, WHO DEVELOPED IT.
THEY BROUGHT IN EXPERTS, AND AS WE SAW
25
WALKING THROUGH HERE, THEY BROUGHT IN EXPERTS WHO CONTRADICTED
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3313
1
THEMSELVES, AND THAT'S SOMETHING FOR YOU TO JUDGE WHEN YOU GO
BACK THERE IN THE JURY ROOM.
AND WITH THAT, I APPRECIATE YOUR ATTENTION AND I'M GOING
TO TURN IT OVER TO MY COLLEAGUE, MR. JOHNSON, WHO'S GOING TO
TALK TO YOU ABOUT THE SAMSUNG CASE, SAMSUNG PATENTS.
(MR. JOHNSON GAVE HIS CLOSING ARGUMENT ON BEHALF OF THE
DEFENDANTS.)
9
10
11
12
MR. JOHNSON:
GOOD AFTERNOON, LADIES AND GENTLEMEN.
LET'S SWITCH GEARS.
I'M HERE TO TALK ABOUT THE TWO
SAMSUNG PATENTS, THE '239 PATENT AND THE '449 PATENT.

NOW, THE AFFIRMATIVE CASE, SAMSUNG'S AFFIRMATIVE CASE WENT
13
BY AND HAPPENED VERY QUICKLY.
WE DIDN'T HAVE MUCH TIME,
14
ESPECIALLY WHEN YOU'RE DEFENDING AGAINST APPLE'S GROSSLY
15
INFLATED DAMAGES CLAIM ON THE APPLE PATENTS.
16
BUT THE QUICK PACE OF THE AFFIRMATIVE CASE SHOULDN'T
17
DETRACT FROM THE IMPORTANCE OF SAMSUNG'S PATENTS, AND I'LL
18
ADDRESS THE EVIDENCE SHORTLY, BUT LET ME SLOW DOWN HERE BECAUSE
19
I WANT YOU TO REMEMBER THE CASE FOR WHAT APPLE DID NOT DO.
20
APPLE DID NOT CHALLENGE THE VALIDITY OF THE SAMSUNG
21
PATENTS.
22
THE APPLE SOURCE CODE THAT WE SHOWED YOU THAT SHOWS THAT APPLE
23
INFRINGES THESE TWO PATENTS.
24
25
APPLE DID NOT CHALLENGE THE MOUNTAIN OF EVIDENCE AND
AND APPLE DID NOT CHALLENGE THE DAMAGES CALCULATIONS ON

THE SAMSUNG PATENTS AT ALL.
THEY DID NOT CHALLENGE -- THEY
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3314
1
DIDN'T BRING A SINGLE WITNESS OR HAVE ANY TESTIMONY TO
CHALLENGE THE TESTIMONY OF DR. KEARL AND DR. RAO ON DAMAGES.
3
4
5
NOW, DR. KEARL CALCULATED DAMAGES TO BE ABOUT $6 MILLION

ON THE '239 PATENT AND ABOUT $158,000 FOR THE '449 PATENT.
NOBODY CAME TO SAY THESE DAMAGES NUMBERS WERE WRONG, AND
NOBODY CAME TO SAY DR. RAO'S STRAIGHTFORWARD SURVEY WAS FLAWED.
APPLE NEVER CALLED DR. VELLTURO, THEIR EXPERT, AND NOBODY
8
9
ELSE CAME TO TESTIFY ON DAMAGES.

SO YOU WILL HEAR, LIKELY WHEN APPLE'S COUNSEL STANDS UP TO
10
DO HIS PART OF THE CLOSING, THAT THEY DON'T INFRINGE EITHER ONE
11
OF THESE PATENTS AND THAT THE TECHNOLOGY IS OLD AND NOT USED.
12
BUT EVEN AS THEIR EXPERT ADMITTED AND AS INSTRUCTION
13
NUMBER 18 SAYS IN THE JURY INSTRUCTIONS, YOU ARE TO COMPARE THE
14
ASSERTED CLAIMS TO THE ACCUSED PRODUCTS.
15
1993 FIRSTLOOK PRODUCT, THE OLD PRODUCT BROCHURES AND THE PRICE
16
QUOTATIONS TO THE ACCUSED PRODUCTS.
17
THE ACCUSED PRODUCTS.
18
YOU DON'T COMPARE THE
YOU COMPARE THE CLAIMS TO
AND IF WE LOOK AT THE '239 PATENT, CLAIM 15, THIS PATENT
19
WAS AHEAD OF ITS TIME.
20
STRAIGHTFORWARD.
21
VIDEO AND THEN TRANSMITTING THAT VIDEO OVER A CELLULAR NETWORK.
22
AND THE CLAIM IS SHORT AND
IT TALKS ABOUT CAPTURING AND COMPRESSING
WE BROUGHT YOU MICHAEL FREEMAN FROM TULSA, OKLAHOMA, WHO
23
WAS THE LEAD INVENTOR ON THE PATENT, AND HE CAME AND TOLD YOU
24
ABOUT THE VIDEO TRANSMISSION TECHNOLOGY THAT HE INVENTED WITH
25
HIS FAMILY, AND IT WAS VERY SUCCESSFUL AND IT WAS USED BY THE
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3315
1
MILITARY, IT WAS USED BY TELEVISION STATIONS AROUND THE
COUNTRY, AND IT WAS USED IN THE OKLAHOMA CITY BOMBINGS TO
STREAM VIDEO TO RESCUERS.
SUCCESSFUL AND HOW IT WON TWO EMMY AWARDS.
HE TOLD YOU HOW THIS TECHNOLOGY WAS
AND THEN WE BROUGHT YOU DR. DAN SCHONFELD, A PROFESSOR
FROM THE UNIVERSITY OF ILLINOIS AT CHICAGO, A PROFESSOR OF
ELECTRICAL ENGINEERING AND COMPUTER ENGINEERING.
8
9
AND HE EXPLAINED HOW THE FACETIME OVER CELLULAR FEATURE

AND THE ABILITY TO TRANSMIT VIDEOS BY E-MAIL AND TEXT MESSAGES
10
ALL INFRINGE CLAIM 15, AND HE WALKED THROUGH A LOT OF DETAIL,
11
THROUGH DOCUMENTS THAT WERE CONFIDENTIAL APPLE DOCUMENTS,
12
CONFIDENTIAL APPLE SOURCE CODE, AND OTHER THIRD PARTY
13
DOCUMENTS.
14
15
16
NOW, THE CLAIMS REQUIRE -- CLAIM 15 REQUIRES A VIDEO

CAPTURE MODULE.
APPLE SAYS THEY DON'T CAPTURE VIDEO.
WELL, WE KNOW WHEN
17
YOU USE AN IPHONE, YOU CAN RECORD AND CAPTURE VIDEO AND IT
18
STORES IT.
19
DR. SCHONFELD SHOWED YOU -- AND THIS IS ONLY FOR THE JURY
20
AT THIS POINT -- HE SHOWED YOU THE APPLE SOURCE CODE THAT SAYS
21
APPLE CAPTURES VIDEO.
22
YOU'LL HAVE IN THE JURY ROOM, AND THESE ARE FUNCTIONS THAT ARE
23
APPLE'S FUNCTIONS THAT ALL DESCRIBE THE FACT THAT THE IPHONES
24
CAPTURE VIDEO.
25
THESE ARE SEGMENTS FROM JX 52A, WHICH
AND YOU'LL RECALL WHEN I CROSS-EXAMINED APPLE'S EXPERT ON
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3316
1
THE STAND AND I ASKED HIM, DID YOU LOOK AT SOURCE CODE AND RELY
UPON IT AS PART OF YOUR DIRECT TESTIMONY, HE HAD TO ADMIT THAT
HE DID NOT.
TESTIMONY.
HE DID NOT RELY UPON SOURCE CODE IN HIS DIRECT
SO DR. SCHONFELD, SAMSUNG'S EXPERT, ALSO SHOWED YOU THE
SOURCE CODE FOR THE NEXT PART OF THE LIMITATION THAT TALKS
ABOUT MEANS FOR TRANSMISSION.
8
9
10
11
AND HE WALKED THROUGH HOW THE SOURCE CODE -- AND AGAIN

CONFIDENTIAL DOCUMENTS, PLAINTIFF'S EXHIBIT 255 -- ALSO
ESTABLISHED THAT THIS PART OF THE LIMITATION IS MET.
SO APPLE'S EXPERT WAS IN A BOX.
WHAT DID THEY DO?
12
APPLE'S EXPERT CAME AND TRIED TO ARGUE THAT APPLE DOESN'T
13
INITIALIZE A PORT AS PART OF THIS MEANS FOR TRANSMISSION.
14
WELL, YOU WILL HAVE DX 351 IN THE JURY ROOM, AND I
15
ENCOURAGE YOU TO LOOK AT PAGE 1818.
16
SEE APPLE REFERS TO THE FACT THAT IT HAS THREE PORTS.
17
18
19
20
21
AND ON THAT PAGE, YOU WILL
AND HE ALSO SHOWED YOU THE PARTS OF THE SOURCE CODE THAT
ALSO ESTABLISH IT HAS PORTS.
SO THEN APPLE'S EXPERT WENT SO FAR AS TO SAY, WELL,
FACETIME DOESN'T TRANSMIT VIDEO.
WELL, WE KNOW FROM COMMON SENSE THAT FACETIME, THE WHOLE
22
PURPOSE BEHIND FACETIME IS TO TRANSMIT VIDEO AND TO HAVE A
23
VIDEO CONVERSATION, AND THAT'S EXACTLY WHAT DR. SCHONFELD
24
EXPLAINED AS HE WALKED THROUGH THE VIDEO THAT SHOWED YOU HOW
25
FACETIME WORKS.
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3317
1
AND, IN FACT, ULTIMATELY WHEN I CROSS-EXAMINED DR. STORER
AGAIN AND I POINTED OUT TO HIM THAT HE HAD PROVIDED A REPORT
EARLIER IN THE CASE AND THAT IN HIS REPORT, IT REFERRED TO THE
FACT THAT, QUOTE, "THE FACETIME APPLICATION PREPARES TO
TRANSMIT VIDEO," HE HAD NO CHOICE BUT TO AGREE WITH ME.
AND THAT STATEMENT THAT HE GAVE IN HIS EXPERT REPORT IN
THIS CASE DIRECTLY CONTRADICTS HIS TESTIMONY IN THIS COURT
WHERE HE SAID THAT FACETIME DOESN'T TRANSMIT VIDEO.
IT TRANSMITS VIDEO.
10
OF COURSE
SO APPLE TOLD YOU DURING THEIR OPENING STATEMENT THAT
11
SAMSUNG SELLS TO APPLE SOME COMPONENTS THAT IT NOW ACCUSES OF
12
INFRINGEMENT.
13
WELL, THIS IS MISLEADING AND WRONG.
FIRST, THE FACT THAT APPLE BUYS SOME COMPONENTS FROM
14
SAMSUNG IS NOT A DEFENSE TO INFRINGEMENT.
15
A DEFENSE.
16
APPLE KNOWS IT'S NOT
THEY DON'T ALLEGE IT'S A DEFENSE.
AND YOU WON'T FIND A JURY INSTRUCTION IN THE JURY
17
INSTRUCTIONS THAT SAYS IT'S A DEFENSE, BECAUSE IT ISN'T A
18
DEFENSE.
19
AS DR. SCHONFELD WENT ON AND EXPLAINED, APPLE ACTUALLY
20
DESIGNS AND IMPLEMENTS THE A6 PROCESSOR, WE SAW THAT PROCESSOR
21
THAT HAD THE APPLE LOGO ON IT, AND WE ALSO SAW -- IF WE PUT UP
22
DX 466, AND AGAIN YOU'LL HAVE THIS IN THE JURY ROOM -- APPLE
23
ITSELF REFERS TO THE FACT THAT IT DESIGNS ITS OWN A6 PROCESSOR
24
CHIP.
25
IN ADDITION, APPLE WRITES ITS SOURCE CODE, AND THE SOURCE
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3318
1
CODE IS CONFIDENTIAL -- THEY WON'T LET US SHOW IT TO ANYBODY
ELSE EXCEPT YOU AND THE COURT AT THIS POINT -- AND THEY COMBINE
THE ACCUSED COMPONENTS AND THE SOURCE CODE IN AN INFRINGING
WAY, AND IT'S THIS COMBINATION OF COMPONENTS WITH THE SOURCE
CODE THAT INFRINGES THE CLAIMS.
6
7
8
9
LET'S TURN TO THE '449 PATENT, THE PHOTO AND VIDEO ALBUM
ORGANIZATION PATENT.
SO CLAIM 27 STARTS WITH A DIGITAL CAMERA.
YOU MR. PARULSKI TO TESTIFY.
HE WAS THE DIGITAL CAMERA EXPERT
10
THAT WORKED AT KODAK FOR 32 YEARS.
11
ARCHITECT.
12
CAMERA.
13
MORE THAN 60 DIGITAL CAMERA PUBLICATIONS.
14
SAMSUNG BROUGHT
HE WAS A DIGITAL CAMERA
HE DEVELOPED THE WORLD'S FIRST COLOR DIGITAL
HE HAS 200, MORE THAN 200 DIGITAL CAMERA PATENTS AND
APPLE BROUGHT YOU DR. STORER AGAIN, THE SAME EXPERT THAT
15
THEY USED ON THE VIDEO TRANSMISSION PATENT, DIFFERENT
16
TECHNOLOGY, AND DR. STORER ADMITTED ON CROSS-EXAMINATION THAT
17
HE DOESN'T HAVE EXPERIENCE DESIGNING DIGITAL CAMERAS.
18
19
20
THE ONLY REAL DIGITAL CAMERA EXPERT THAT YOU HEARD IN THIS
CASE WAS SAMSUNG'S MR. PARULSKI.
AND MR. PARULSKI WALKED THROUGH, AGAIN, THE EVIDENCE,
21
APPLE INTERNAL DOCUMENTS THAT CONFIRMED EACH PART OF THE CLAIM
22
IS IN THE ACCUSED PRODUCTS.
23
255 AND 351 TO LOOK AT IN THE JURY ROOM, AND HE WALKED THROUGH
24
EACH LIMITATION THAT WE SEE HERE, AND ALSO ON THE NEXT SLIDE,
25
PLEASE, KEN.
YOU'LL HAVE PLAINTIFF'S EXHIBIT
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3319
1
AND HE SHOWED YOU THAT THIS PATENT IS ALL ABOUT SEARCHING
FOR PHOTOGRAPHS AND VIDEOS, AND HE SHOWED YOU THAT WHEN YOU
HAVE A PHONE, THE APPLE CAMERA ROLL, AND YOU LOOK AT THE CAMERA
ROLL, YOU CAN SEARCH THROUGH A LIST OF PHOTOGRAPHS TO FIND THE
PHOTO OR THE VIDEO THAT YOU'RE LOOKING FOR.
AND HE THEN EXPLAINED HOW THE SOURCE CODE IN THE APPLE
CONFIDENTIAL DOCUMENTS CONFIRM HIS UNDERSTANDING, AND HE WALKED
THROUGH A LOT OF LIMITATIONS AND FOUND THAT EACH OF THEM WERE
PRESENT IN THE IPHONE AND THE IPOD.
10
NOW, LET'S TALK A LITTLE BIT ABOUT DAMAGES.
11
AGAIN, IN THIS CASE WHERE THE PARTIES DISAGREED ON ALMOST
12
EVERYTHING, APPLE DIDN'T BRING A SINGLE WITNESS TO CHALLENGE
13
SAMSUNG'S DAMAGES CASE.
14
OF ECONOMICS WHO HAS WRITTEN BOOKS, TEXTBOOKS ON ECONOMICS,
15
HE'S CALCULATED PATENT DAMAGES IN A LOT OF CASES, AND HE EVEN
16
WAS RETAINED BY THE COURT TO SERVE AS A NEUTRAL EXPERT FOR THE
17
COURT IN ANOTHER CASE.
18
19
20
YOU HEARD FROM DR. KEARL, A PROFESSOR
AND YOU HEARD FROM DR. RAO, A SURVEY EXPERT WHO HAS
EXTENSIVE EXPERIENCE DESIGNING AND CONDUCTING SURVEYS.
NOW, DR. KEARL DID A SIMPLE, STRAIGHTFORWARD ANALYSIS, AND
21
HE USED THE STRAIGHTFORWARD SURVEY THAT DR. RAO HAD DONE TO
22
MEASURE THE RELATIVE VALUE OF THE PATENTED FEATURES IN THE '239
23
AND THE '449 PATENT, AND HE USED REAL WORLD EVIDENCE.
24
25
HE USED A REAL WORLD PRICE OF $.99 FOR FACETIME, WHICH IS

THE PRICE THAT APPLE USERS PAID TO DOWNLOAD THE FACETIME APP
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3320
1
2
ONTO ITS DESKTOP.

AND THAT'S WHAT ECONOMISTS DO, THEY USE REAL WORLD
EVIDENCE AND REAL WORLD MARKET PRICES.
DR. KEARL DID HERE.
THAT'S EXACTLY WHAT
AND FOR THE '239 PATENT, HE CALCULATED THAT THE DAMAGES
ARE A LITTLE OVER 6 MILLION FOR ALL THREE OF THE IMPORTANT
FEATURES OF FACETIME, BEING ABLE TO SEND E-MAIL, AN E-MAIL WITH
A VIDEO OR BEING ABLE TO TEXT MESSAGE A VIDEO.
AND HIS DAMAGES CALCULATIONS ON BOTH PATENTS CAN BE FOUND
10
IN DEFENDANT'S EXHIBIT 391A, AND YOU'LL HAVE THAT IN THE JURY
11
ROOM ALSO TO REFER TO.
12
THAT EXHIBIT IS IN EVIDENCE.
NOW, AGAIN, YOU DIDN'T HEAR FROM DR. VELLTURO OR ANYBODY
13
ELSE THAT DR. KEARL'S NUMBERS WERE WRONG.
14
CHALLENGED HIS CALCULATIONS OR HIS METHODOLOGY, AND NOT A
15
SINGLE WITNESS CHALLENGED DR. RAO'S SURVEY, EITHER.
16
NOT A SINGLE WITNESS
NOW, FOR THE '449 PATENT, THE NUMBER IS CONSIDERABLY
17
LOWER.
IT'S $158,000, AND DR. KEARL TESTIFIED THAT'S BECAUSE
18
OF TWO REASONS.
19
VALUABLE AS THE FACETIME AND E-MAILING VIDEOS FEATURE THAT'S
20
COVERED BY THE '239.
THE FIRST IS THE VIDEO ALBUM PATENT IS NOT AS
21
AND SECOND, FOR THE '449 PATENT, THERE'S A NON-INFRINGING
22
ALTERNATIVE, A WAY TO DESIGN AROUND THE PATENT, AND IF A PATENT
23
IS EASY TO DESIGN AROUND, IT LOWERS THE VALUE OF THE PATENT.
24
THAT MAKES SENSE.
25
SO DR. KEARL USED REAL WORLD EVIDENCE, AND HE ALSO USED
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THE FACT THAT -- REMEMBER, THE INVENTOR CAME AND TESTIFIED THAT
HE HAD SEVERAL PATENT TECHNOLOGY COMPANIES THAT WERE INTERESTED
IN BUYING HIS VIDEO TRANSMISSION PATENT.
$2.3 MILLION FOR TWO PATENTS, AND HE USED THAT AS A CHECK, AS A
REALITY CHECK TO CHECK HIS NUMBER AND HIS METHODOLOGY.
SAMSUNG PAID
AND HE ALSO USED THE FACT THAT HITACHI AND SAMSUNG HAD
ENTERED INTO AN AGREEMENT WHERE SAMSUNG PURCHASED THE '449
PATENT AS PART OF A BUNDLE OF PATENT RIGHTS.
ABOUT 106 PATENTS AND PATENT APPLICATIONS FOR $35 MILLION, AND
10
11
THEY PURCHASED
HE USED THAT AS ANOTHER REALITY CHECK.

I'LL EXPECT THAT APPLE'S COUNSEL, IN CLOSING, WILL SAY --
12
TRY AND MAKE AN ISSUE OUT OF THE FACT THAT SAMSUNG PURCHASED
13
BOTH OF THESE PATENTS.
14
PATENTS.
15
16
17
THERE'S NOTHING WRONG WITH PURCHASING
COMPANIES BUY AND SELL PATENTS ALL THE TIME.
AND YOU WON'T HEAR APPLE SAY THAT PURCHASING A PATENT IS A

DEFENSE TO INFRINGEMENT.
IT ISN'T.
AND THE SAME IS TRUE WITH THE '239 PATENT BEING EXPIRED.
18
THE FACT THAT IT'S NOW EXPIRED DOESN'T RELIEVE APPLE OF THE
19
FACT THAT IT'S STILL LIABLE FOR INFRINGEMENT WHILE THAT PATENT
20
WAS ACTIVE.
21
SO WITH THAT, I GO BACK TO THE FACT THAT THE REAL WORLD
22
PURCHASE PRICES THAT DR. KEARL RELIES ON SERVE AS A REALITY
23
CHECK, AND THEY CONFIRM WHAT YOUR COMMON SENSE ALREADY TELLS
24
YOU, THE $6 MILLION NUMBER FOR THE '239 PATENT AND THE $158,000
25
NUMBER FOR THE '449 PATENT MAKES SENSE.
THEY'RE REAL WORLD
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NUMBERS THAT APPLE DOES NOT DISPUTE.
THANK YOU.
I'LL TURN IT OVER TO MR. QUINN.
4
5
MR. QUINN:
THANK YOU.
LADIES AND GENTLEMEN, I HAVE VERY LITTLE TIME TO TALK
ABOUT DAMAGES, SO I'M GOING TO HAVE TO RELY ON YOU FOLKS TO
REMEMBER A LOT OF THE DETAILS BECAUSE THIS IS GOING TO BE
PAINFULLY QUICK.
I APOLOGIZE FOR THAT.
BUT I WILL BE TALKING ABOUT APPLE'S DAMAGES CLAIM, AND NOT
10
BECAUSE -- JUST TO BE CLEAR, I THINK IT IS CLEAR, WE DON'T
11
THINK WE OWE APPLE A NICKEL.
12
THE ISSUES, INCLUDING DAMAGES, AND IN THIS CASE IN PARTICULAR,
13
I THINK IT'S KIND OF REVEALING TO LOOK AT APPLE'S DAMAGES CASE
14
FOR THE LIGHT IT SHEDS ON ALL OF ITS CASE AND THE CREDIBILITY
15
OF ITS CASE.
16
BUT WE'RE REQUIRED TO ADDRESS ALL
YOU'LL RECALL THERE ARE THREE BUCKETS OF DAMAGES THAT THEY
17
SEEK, THE DIMINISHED DEMAND LOST PROFITS, THE OFF THE MARKET
18
LOST PROFITS, AND THEN THE REASONABLE ROYALTY.
19
20
21
I'M GOING TO DISCUSS THOSE IN ORDER, AND I'M GOING TO

BEGIN WITH THE DIMINISHED DEMAND LOST PROFITS.
YOU'LL RECALL THESE ARE -- THE THEORY OF THIS IS THAT IF
22
WE DIDN'T HAVE THESE FIVE FEATURES IN OUR PHONES, WE WOULD SELL
23
FEWER PHONES AND APPLE WOULD CAPTURE A NUMBER OF THOSE PHONES
24
EQUAL TO ITS MARKET SHARE.
25
PERCENT.
THAT'S THE THEORY, ABOUT 40
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AND LADIES AND GENTLEMEN, THAT IS ALL HAUSER.
HAUSER.
RELY ON HIM JUST TO SAY, AS MR. MCELHINNY SUGGESTED, THAT THIS
SHOWS, THIS SURVEY SHOWS THERE IS DEMAND FOR THESE FEATURES.
5
6
THAT IS -- HE'S CENTRAL TO THAT THEORY.
THAT IS
THEY DON'T
THE ONLY QUANTITATIVE BASIS THAT DR. VELLTURO HAD FOR HIS
DIMINISHED DEMAND NUMBERS WAS HAUSER.
THAT'S ALL HE'S GOT.
HE'S ALSO THE BASIS FOR THE WILLINGNESS TO PAY AND THE,
YOU KNOW, WILLINGNESS TO BUY NUMBERS AND REASONABLE ROYALTY,
AND I'LL GET TO THAT, THAT'S ALSO BASED ON HAUSER.
10
BUT IF VELLTURO DOESN'T HAVE HAUSER, HE DOESN'T HAVE ANY
11
BASIS FOR THESE DIMINISHED DEMAND NUMBERS, SO IT'S IMPORTANT TO
12
BEGIN WITH HIM.
13
14
AND I JUST WANT TO SAY AT THE BEGINNING, WE DON'T HATE

PROFESSOR HAUSER.
15
WE DON'T HATE HIM.
HIS SURVEY, THOUGH, WAS USELESS TO ACCOMPLISH THE PURPOSE
16
THAT HE OFFERED IT FOR.
17
TIME TO DISCUSS A FEW.
IT HAS A NUMBER OF FLAWS.
I ONLY HAVE
18
IN THAT SURVEY, HE PRETENDS LIKE HE'S MEASURING THE
19
DIFFERENCE BETWEEN THE PATENT AND THE ALTERNATIVE, AND YOU SAW
20
THAT.
21
UNDERSTATES WHAT THE ALTERNATIVES ARE.
22
23
24
25
YOU SAW HOW HE OVERSTATES THE BREADTH OF THE PATENT AND
AND REMEMBER, THOSE DESCRIPTIONS IN THE SURVEY CAME FROM

THE LAWYERS.
IF WE CAN LOOK AT SLIDE 45, I SHOWED YOU THIS IN THE
OPENING STATEMENT.
AUTOMATIC WORD CORRECTION, THIS IS THE ONLY
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WAY YOU CAN GET AUTOMATIC WORD CORRECTION.
OUR FEATURE, YOU KNOW, YOU'VE GOT TO GO DOWN TO THE SECOND AREA
AND SELECT A DIFFERENT SPELLING OR A DIFFERENT WORD.
YOU KNOW THAT'S SIMPLY NOT TRUE.
SLIDE 47.
IF YOU DON'T HAVE
THE DART PHONE, WE'VE HAD IT SINCE JUNE 15TH,
2011.
FROM, YOU KNOW, WELL BEFORE THEIR PATENT ISSUED.
THAT.
THAT WAS AUTOMATIC WORD CORRECTION.
IN OPENING STATEMENT.
9
10
WE HAD
I SHOWED IT TO YOU
THAT WAS NEVER DISPUTED.

WHAT IS APPLE'S RESPONSE TO THAT?
SLIDE 48.
THEY SAY,
11
WELL, THEY FOUND THIS DOCUMENT WHERE SOME UNNAMED PERSON SAYS
12
SOMEONE ELSE SAID THE DART KEYBOARD WAS, QUOTE-UNQUOTE, A
13
SOMEWHAT JARRING EXPERIENCE, SO SOMEHOW THAT'S NOT A SUITABLE
14
ALTERNATIVE.
15
TAKE A LOOK AT THE DATE OF THAT DOCUMENT.
16
SLIDE 49.
17
THE S III PHONE LAUNCHES, OUR ALL TIME BEST SELLER.
18
THAT'S DATED APRIL 2012.
IT'S PX 168,
THAT IS TWO MONTHS BEFORE
NOTWITHSTANDING THAT DOCUMENT, WE LAUNCHED THAT PHONE WITH
19
THE DART KEYBOARD, AUTOMATIC WORD CORRECTION, AND WE SOLD
20
3 MILLION PHONES WITH THAT KEYBOARD WITH NO COMPLAINTS.
21
BROUGHT IN ANY EVIDENCE THAT THERE WERE ANY COMPLAINTS.
22
NOBODY
IT WAS REPLACED WITH ANOTHER NON-INFRINGING KEYBOARD A FEW
23
MONTHS LATER, BUT THE POINT IS THIS WAS A CONTRIVED -- THIS WAS
24
A -- THIS SURVEY IS JUST AN EFFORT TO MISLEAD YOU.
25
SYNCING, IF WE LOOK AT SLIDE 44, YOU SAW WHAT PEOPLE WERE
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TOLD.
HAVE TO WAIT.
IF YOU DON'T HAVE THIS FEATURE, YOU HAVE TO WAIT.
YOU
NO -- NO INFORMATION HERE ABOUT THIS IS THREE COMPONENT
BACKGROUND SYNCING, THIS IS OUR PARTICULAR PATENT.
JUST SAY, IF YOU DON'T HAVE THIS, YOU'RE GOING TO HAVE TO WAIT
AND THE WAIT MAY BE LONG OR SHORT.
YOU KNOW, APPLE DOESN'T OWN EVERYTHING.
ALL WAYS OF SYNCING IN BACKGROUND.
THREE COMPONENT SYNCING.
10
NO.
THEY
APPLE DOESN'T OWN
THEY'VE GOT THIS CLAIM FOR
THEY DON'T OWN ALL WAYS OF SYNCING.
THIS WAS NOT A DESCRIPTION OF THE WORLD AS IT REALLY IS TO
11
SAY, YOU KNOW, IF YOU DON'T DO WHAT WE DO, WHICH THEY DON'T
12
EVEN DESCRIBE, YOU KNOW, YOU'RE GOING TO HAVE TO WAIT.
13
14
WE SHOWED YOU OTHER, THE WINDOWS MOBILE, MR. NELSON SHOWED

YOU SLIDE 43, IT WAS ALREADY OUT THERE.
15
SO, YOU KNOW, THE DESCRIPTIONS WERE FLAWED.
16
SECOND, THE DESIGN OF THE SURVEY MADE IT ABSOLUTELY
17
WORTHLESS FOR WHAT APPLE TRIED TO DO.
YOU KNOW, YOU CAN'T --
18
CONJOINT SURVEYS HAVE THEIR USES.
19
WANTED TO COMPARE CUP HOLDERS AND SEE WHAT CUP HOLDERS PEOPLE
20
PREFER, OR SMALL FEATURES COMPARING THEM AGAINST EACH OTHER,
21
CONJOINT SURVEYS ARE FINE.
YOU HEARD THAT.
IF YOU
22
BUT YOU CAN'T ASK PEOPLE ABOUT CUP HOLDERS AND MAKE
23
CONCLUSIONS ABOUT WHAT AUTOMOBILES THEY WOULD BUY OR WHAT
24
SHIFTS IN MARKET SHARE WOULD BE.
25
DR. HAUSER'S SURVEY IS LIKE SAYING, TELL ME WHAT CUP
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HOLDER YOU LIKE, WHAT GLOVE BOX LATCH YOU PREFER, WHICH AIR
CONDITIONING KNOBS YOU PREFER, TELL ME WHETHER YOU WANT TWO
DOORS OR FOUR DOORS, AND TELL ME THE COLOR OF THE CAR YOU WANT
AND I WILL TELL YOU WHAT CAR YOU'LL BUY.
COMES DOWN TO.
6
7
8
9
YOU CAN'T DO THAT.
THAT'S REALLY WHAT IT
FOR COMPLEX PRODUCTS, YOU HAVE TO
INCLUDE THE MAJOR FEATURES.

AND THIS MAY HAVE GONE PAST A LOT OF US BECAUSE IT
HAPPENED SO FAST.
ON THE STAND, DR. HAUSER ACTUALLY AGREED
10
WITH THIS.
SLIDE 42.
HE WAS ASKED THE QUESTION, "YOU DO AGREE
11
THAT FOR THE PURPOSE OF ESTIMATING DEMAND FOR A PATENTED
12
FEATURE, MAJOR PRODUCT FEATURES MUST BE INCLUDED?
13
"ANSWER:
YES."
14
BUT THAT'S EXACTLY WHAT HE DIDN'T DO.
HE LEFT OUT THE
15
MAJOR FEATURES, THE TRUE DRIVERS, BRAND, BATTERY LIFE, LG --
16
YOU KNOW, 4G LTE.
17
IT'S NOT A PROPER USE OF A SURVEY.
INSTEAD -- AND THEN THE OTHER THING HE, YOU KNOW, HE
18
EDUCATED PEOPLE.
19
THESE SAMSUNG PHONE OWNERS, WHY DID YOU BUY YOUR PHONES AND
20
FINDING OUT WHAT THEY KNEW ABOUT THESE FEATURES, DO YOU KNOW
21
YOU'VE GOT THIS THREE COMPONENT BACKGROUND SYNC OR NOT, DO YOU
22
KNOW YOU HAVE THIS PHONETOP SEARCH WITH TWO HEURISTICS, INSTEAD
23
HE EDUCATED THEM, MADE THEM WATCH 18 VIDEOS BEFORE THEY TAKE
24
THE SURVEY.
25
INSTEAD OF FINDING OUT, YOU KNOW, ASKING
THAT CREATES WHAT DR. ERDEM SAYS ARE DEMAND ARTIFACTS.
IT
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ARTIFICIALLY INFLATES THE VALUE OF THE FEATURES.
GOING TO GET ANY USEFUL INFORMATION THAT WAY.
AND HOW DOES HE KNOW?
IS IT HAS NO INTEGRITY.
UNDERSTAND IT.
6
7
8
9
10
11
YOU'RE NOT
YOU KNOW, THE WHOLE POINT OF THIS
IT HAS NO RELIABILITY IF PEOPLE DON'T
WELL, DR. HAUSER SAID, I CHECKED WHETHER THEY UNDERSTOOD

IT.
I ASKED THEM, DID YOU UNDERSTAND?
YES.
END OF IT.
HE WAS ASKED -- MR. PRICE ASKED HIM ON THE STAND, DIDN'T

YOU ASK THEM WHAT YOU UNDERSTOOD?
HE SAYS, DON'T YOU DO THAT
IN YOUR CLASSES AT SCHOOL?

HE SAID, NO, I'M A SOCRATIC TEACHER.
I DON'T GIVE TESTS
12
LIKE THAT TO ASK WHAT PEOPLE ACTUALLY LEARN.
13
DOES THIS MAKE ANY SENSE TO YOU FOLKS?
WE'RE RELYING ON
14
YOU TO COME TO THIS COURTROOM AS JURORS AND USE YOUR COMMON
15
SENSE, AND IT WAS CLEAR THAT THESE PEOPLE DID NOT UNDERSTAND
16
THESE QUESTIONS.
17
DR. REIBSTEIN, YOU'LL RECALL, DID AN EXACT PRE-TEST USING
18
THE EXACT SAME WORDS THAT DR. HAUSER USED.
SLIDE 50.
HE FOUND
19
OVERWHELMING CONFUSION, THE YESES UP THERE ARE, YEAH, IT TURNED
20
OUT PEOPLE WERE CONFUSED.
21
SLIDE 51, 25 OUT OF 26 DIDN'T UNDERSTAND QUICK LINKS.
22
22 OUT OF 26 DIDN'T UNDERSTAND BACKGROUND SYNCING.
23
18 OUT OF 26 WERE CONFUSED ABOUT AUTOMATIC WORD
24
25
CORRECTION.
REMEMBER THE VIDEOS.
UNIVERSAL SEARCH MEANT YOU COULD
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2
HAVE WI-FI WHEREVER YOU WERE.
YOU WOULD ALWAYS BE CONNECTED.
TO SYNC, YOU HAVE TO HOOK UP.
WHAT IT MEANT IS, YOU KNOW,
IF YOU DIDN'T HAVE THEIR BACKGROUND SYNCING, YOU WOULD HAVE TO
HOOK UP, USE A USB CABLE TO HOOK UP TO YOUR COMPUTER.
YOU KNOW, IF YOU DON'T HAVE THEIR ANALYZER SERVER, YOU
HAVE TO WRITE DOWN AND MEMORIZE PHONE NUMBERS AND ADDRESSES.
YOU DON'T HAVE TO TAKE DR. REIBSTEIN'S WORD FOR IT.
PLEASE LOOK AT DEFENSE EXHIBIT 454A.
TRANSCRIPTS OF ALL THOSE INTERVIEWS AND YOU CAN DECIDE FOR
10
YOURSELVES.
11
THEY WERE BEING ASKED?
12
THERE YOU'LL HAVE THE
DID THESE PEOPLE HAVE THE FOGGIEST IDEA OF WHAT
ONE OF MY FAVORITES, SLIDE 54, HOW WAS THE ALTERNATIVE?
13
YOU KNOW, IF YOU'RE NOT GOING TO USE THE CLAIMED PATENTED
14
FEATURE, HOW WAS THAT PRESENTED TO PEOPLE IN THESE SURVEYS?
15
EMPTY BOX.
16
17
18
AN
AN EMPTY SQUARE.
HOW CAN YOU MINIMIZE IT MORE THAN BY JUST PUTTING UP AN

EMPTY BOX AND AN EMPTY SQUARE?
THIS WAS COMPLETELY CONTRIVED.
THIS WAS A SHAM SURVEY
19
DONE BY A MAN WHO MAY HAVE -- HE'S AT M.I.T., HAS A PH.D., HE
20
DID THIS FOR MONEY, APPLE PAID HIM, AND HE CAME IN AND
21
PRESENTED YOU WITH A SHAM.
22
FOLKS.
23
HOW DO WE KNOW THAT?
I'M JUST -- THAT'S THE WAY IT IS,
TAKE A LOOK AT THIS SLIDE 55.
LOOK
24
AT HIS CONCLUSIONS.
FOR A PHONE THAT COSTS $149, HE CONCLUDED
25
PEOPLE WOULD PAY, JUST FOR EXAMPLE, $102 MORE TO HAVE THEIR
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PARTICULAR VERSION OF AUTOMATIC WORD CORRECTION OR SUGGESTION
WHICH THEY DON'T EVEN USE.
OKAY?
IT'S ABSURD.
REMEMBER WHEN MR. PRICE ASKED HIM, YOU KNOW, ISN'T THIS
5
6
YOU KNOW THIS IS RIDICULOUS.
KIND OF ABSURD TO THINK THAT PEOPLE WOULD SPEND THAT MUCH MORE?
AND THEN DR. HAUSER WENT KIND OF THE USED CAR SALESMAN'S
TRICK, WELL, IT'S ONLY FOUR BUCKS MORE A MONTH.
ITSELF IS SIX BUCKS MORE A MONTH.
9
10
11
BUT THE PHONE
I MEAN, WHAT KIND OF CREDIBILITY -- THIS HAS ABSOLUTELY NO

CREDIBILITY.
OTHER IRRATIONAL RESULTS, YOU KNOW, UNCONTRADICTED
12
TESTIMONY, 68 PERCENT OF THE RESPONDENTS, IF YOU LOOK AT THE
13
DATA, ACTUALLY PREFERRED HIGHER PRICES FOR PHONES WITH THE SAME
14
FEATURES.
15
IT DID A TERRIBLE JOB -- SLIDE 56 -- IF YOU USED HIS DATA
16
OF ACTUALLY PREDICTING WHAT WOULD HAPPEN IN THE REAL
17
MARKETPLACE.
18
CHOICE SETS, RUNNING IT THROUGH THE SAWTOOTH SOFTWARE PROGRAM,
19
THAT THE NOTE 2 WOULD OUTSELL THE GS III.
20
GS III OUTSOLD THE NOTE 2 MANY, MANY TIMES MORE.
21
HE PREDICTS WITH HIS DATA, GOING THROUGH ALL THE
IN REAL LIFE, THE
APPLE WANTS YOU TO RELY ON THIS SURVEY.
IT IS CENTRAL
22
THAT THEIR DAMAGES CASE, BOTH REASONABLE ROYALTY AND DIMINISHED
23
DEMAND.
24
SAMSUNG DIDN'T HAVE -- HAUSER SHOWS THAT IF SAMSUNG DIDN'T HAVE
25
THESE THINGS, YOU'D HAVE 20 TO 45 PERCENT DECLINE IN SALES.
IT'S CENTRAL TO THEIR CASE.
THEY SAY, YOU KNOW,
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1
2
TRUST YOUR INSTINCTS.
TRUST YOUR COMMON SENSE.
THIS
SURVEY IS WORTHLESS.
NOW WE TURN TO DR. VELLTURO.
WHAT DOES HE DO?
HE TAKES
THOSE RESULTS -- HAUSER'S OUTPUT IS EXPRESSED AS A PERCENTAGE
DECLINE IN SALES.
SAMSUNG'S SALES NUMBERS, YOU KNOW, FIGURES OUT HOW MANY UNITS
THERE ARE, YOU KNOW, DECREASED NUMBER OF UNITS, APPLIES APPLE'S
MARKET SHARE AND CONVERTS THAT TO A LOST PROFITS NUMBER.
9
10
HAUSER TAKES THAT, LOOKS AT APPLE'S -- AT
IT'S ALL BASED ON HAUSER.
SLIDE 1.
DR. VELLTURO
ACKNOWLEDGED THAT.
11
FOLKS, IN THE REAL WORLD, IF THESE FEATURES DRIVE 20 TO 45
12
PERCENT OF THE SALES, WHICH IS WHAT HAUSER CONCLUDES, WHY DON'T
13
THEY SHOW UP ANYWHERE IN THE REAL WORLD?
14
EVIDENCE -- SLIDE 2 -- PRODUCED BY THESE COMPANIES, BOTH OF
15
THEM, BEFORE THERE EVER WAS A LAWSUIT, THEY LOOKED AT WHY DO
16
PEOPLE BUY PHONES?
17
THEM?
18
WHAT DO THEY RELY ON?
BUYER SURVEYS.
20
BACK AND LOOK AT THEM.
22
23
WHAT MATTERS TO
UP ON THE CHART WE'VE GOT SOME OF THOSE.
19
21
YOU SAW A LOT OF
YOU'VE SEEN THE
YOU CAN JOT DOWN THE NUMBERS IF YOU WANT TO GO
THESE THINGS NEVER SHOWED UP.
APPLE CLAIMED FEATURES JUST
AREN'T FACTORS AT ALL.

LET ME TURN TO HIS LOST PROFITS CALCULATION.
YOU GOT SOME
24
INSTRUCTION FROM THE COURT ON THIS -- THIS IS SLIDE 63 -- AND
25
THIS IS ANOTHER REASON THE DIMINISHED DEMAND THEORY MAKES NO
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2
SENSE AT ALL.
IT'S -- FOR LOST PROFITS, UNDER THE LAW, YOU MUST FIND
THAT BUT FOR, BUT FOR THE INFRINGEMENT, APPLE WOULD HAVE MADE
SALES THAT IT OTHERWISE DID NOT HAVE.
REQUIRES, BUT FOR ACTUAL CAUSATION.
THAT'S WHAT THE LAW
AS DR. CHEVALIER'S ANALYSIS SHOWED -- THIS IS SLIDE 4 --
THERE'S ABSOLUTELY NO CORRELATION BETWEEN SAMSUNG -- THE
PROFITABILITY OF SAMSUNG PHONES AND THE USE OF THEIR CLAIMED
TECHNOLOGY.
OUR MOST PROFITABLE PHONES ARE THE ONES THAT ARE
10
CHARGED AS BEING LEAST INFRINGING, THE NOTE 2 AND THE
11
GALAXY S III.
12
IF YOU THINK ABOUT IT FOR A MOMENT, THE IDEA THAT APPLE
13
LOST SALES BECAUSE SAMSUNG ALLEGEDLY HAD THESE FEATURES IS,
14
FRANKLY, NONSENSICAL.
15
INTO A STORE, GEE, WHAT DO I WANT TO BUY?
16
PHONE THAT HAS A, YOU KNOW, THREE COMPONENT BACKGROUND SYNCING,
17
I WANT TO MAKE SURE I'VE GOT THAT, AND I WANT AN ANALYZER
18
SERVER, I DON'T WANT SHARED LIBRARIES, I WANT TO MAKE SURE I
19
CAN SEARCH ON THE INTERNET AND ON THE PHONE, I WANT THE TWO
20
HEURISTICS.
21
BATTERY LIFE OR THE REST OF IT.
22
IMAGINE, FOR EXAMPLE, A CUSTOMER GOING

I WANT TO BUY A
THESE ARE MORE IMPORTANT TO ME THAN BIG SCREEN OR
AND BY THE WAY, I THINK DR. ERDEM IS RIGHT.
ONLY A TECHNO
23
GEEK WOULD BE GOING AND LOOKING FOR, YOU KNOW, THESE KINDS OF
24
DETAILED IMPLEMENTATIONS.
25
LET'S GET REAL.
NOBODY EVER BOUGHT A PHONE TO GET THESE
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THINGS.
EVER BOUGHT A PHONE BECAUSE THEY WANTED TO GET SLIDE TO UNLOCK.
EVEN, YOU KNOW, SLIDE TO UNLOCK.
I DARE SAY, NOBODY
SAMSUNG WOULDN'T BE LOSING SALES IF IT USED CIRCLE UNLOCK,
IF IT USED RIPPLE WHICH, YOU KNOW, ITS BEST SELLING GS III
PHONE USES.
AND BY THE WAY, THEY TRIED TO SUGGEST, WELL, YOU HAVE TO
HAVE OUR FORM OF SLIDE TO UNLOCK, IT'S BETTER THAN ALL THE
ALTERNATIVES BECAUSE OTHERWISE, YOU KNOW, ACCIDENTAL UNLOCKING
IS, YOU KNOW, IT'S, IT'S MORE PROBABLE THAT IT MIGHT HAPPEN.
10
THEY COULDN'T IDENTIFY A SINGLE, NOT ONE, IN THIS WHOLE
11
TRIAL, YOU WERE HERE FOUR WEEKS, CUSTOMER COMPLAINT ABOUT ANY
12
OF SAMSUNG'S OTHER FEATURES, WAYS OF UNLOCKING OF BEING MORE
13
PRONE TO UNLOCK.
14
THERE'S SIMPLY NO EVIDENCE OF THAT.
THE IDEA THAT SOME HYPOTHETICAL, YOU KNOW, TECHNO GEEK
15
WOULD BUY AN APPLE PHONE IF SAMSUNG DIDN'T HAVE THESE FEATURES,
16
NOW, I'M GOING TO SWITCH TO APPLE BECAUSE SAMSUNG NO LONGER HAS
17
THESE FEATURES, MAKES NO SENSE.
18
WHY?
19
KNOW THAT.
20
PROFITS BECAUSE SAMSUNG HAS THESE FEATURES, YOU TAKE AWAY THE
21
FEATURES FROM SAMSUNG, THEY'LL BUY OUR PHONES WHEN WE DON'T
22
HAVE THEM EITHER.
23
24
25
BECAUSE APPLE DOESN'T HAVE THEM EITHER.
YOU NOW
THAT'S THE THEORY THEY'RE TRYING TO SELL.
WE LOST
AT THE TIME OF OPENING STATEMENT, I SAID THREE OUT OF

FIVE.
THAT WAS AGREED.

THE ANALYZER SERVER, AS MR. NELSON SAID, THEY PUT ON NO
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EVIDENCE, NONE, THAT THEY PRACTICED THAT ANALYZER SERVER
PATENT.
3
4
5
YOU KNOW THIS WAS AN IMPORTANT ISSUE.
YOU KNOW IF THEY
PRACTICED IT, THEY WOULD HAVE PUT THAT EVIDENCE IN.

AND I'LL LEAVE IT TO YOU TO LOOK AT THE IOS 7, YOU KNOW,
THE NEW UNLOCK SCREEN WHICH, BY THE WAY, LOOKS A LOT LIKE THE
SAMSUNG GLASS UNLOCK, WHICH HAD COME OUT BEFORE.
TO YOU TO TAKE A LOOK AT THAT -- THAT'S DEFENSE EXHIBIT 345 --
AND YOU DECIDE FOR YOURSELF IF APPLE IS STILL PRACTICING SLIDE
10
11
I'LL LEAVE IT
TO UNLOCK.
NO LOST PROFITS, NO LOST SALES, NO EVIDENCE THAT ANYONE
12
EVER FAILED TO BUY AN IPHONE BECAUSE SAMSUNG HAD THESE
13
FEATURES.
14
SECOND BUCKET OF DAMAGES, OFF THE MARKET.
15
THE THEORY HERE IS, YOU KNOW, BASED ON HOW LONG SAMSUNG --
16
IF SAMSUNG HAD TO DO A DESIGN AROUND, IF WE ACTUALLY DID
17
INFRINGE, WE'RE USING THEIR TECHNOLOGY, WE INFRINGE, WE HAVE TO
18
DO A DESIGN AROUND, WE HAVE TO TAKE OUR PRODUCTS OFF THE MARKET
19
WHILE WE COME UP WITH AN ALTERNATIVE.
20
THEIR THEORY, THEIR THEORY IS, WHILE WE'RE OFF THE MARKET
21
FOR THAT TIME WHILE WE'RE COMING UP WITH AN ALTERNATIVE, APPLE
22
IS GOING TO SELL A LOT MORE PHONES.
23
LOST, YOU KNOW, LOST PROFITS THEORY.
24
25
THAT'S THE OFF THE MARKET
THIS AGAIN APPLIES ONLY TO THE THREE PATENTS.

DR. VELLTURO ACKNOWLEDGED THIS.
SLIDE 5.
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NOW, THIS PRESENTS A REALLY IMPORTANT CREDIBILITY ISSUE
BECAUSE DR. VELLTURO CAME IN HERE AND HE CHOSE TO GIVE YOU
CALCULATIONS FOR ONLY ONE OFF THE MARKET PERIOD, FOUR MONTHS.
HE SAID IT'S GOING TO BE FOUR MONTHS.
BY THE WAY, HE'S A FINANCIAL GUY.
BEING A TECHNOLOGY GUY?
SAY IT WOULD TAKE FOUR MONTHS?
THE SCOPE OF HIS EXPERTISE.
HOW DOES HE GET OFF
YOU KNOW, A SMARTPHONE EXPERT WHO CAN

THAT WAS -- THAT'S NOT WITHIN
BUT HE CAME IN AND SAID, I'M GOING TO GIVE YOU THE NUMBERS
10
ABOUT WHAT OUR LOST PROFITS WOULD BE IF SAMSUNG WERE OFF THE
11
MARKET FOR FOUR MONTHS, NOT ONE MONTH, NOT TWO MONTHS, NOT
12
THREE MONTHS.
13
AND THIS IS SLIDE 6.
INTERESTINGLY, HE HAD DONE A REPORT BEFORE WHEN THERE WERE
14
A DIFFERENT MIX OF PRODUCTS AT ISSUE AND HE ACKNOWLEDGED IN HIS
15
REPORT BEFORE, HE HAD DONE CALCULATIONS BOTH AT FOUR MONTHS AND
16
AT ONE MONTH.
17
AND WHEN HE WAS ON THE STAND, HE ACKNOWLEDGED TO ME THAT
18
HE HAD DONE THE ONE MONTH CALCULATION BEFORE, HE KNEW HOW TO DO
19
IT, BUT HE DIDN'T COME HERE THIS TIME AND PRESENT YOU WITH THAT
20
NUMBER.
21
HE ONLY PRESENTED YOU WITH THE FOUR MONTH FIGURE.
THAT'S, YOU KNOW, CONSISTENT WITH APPLE'S APPROACH IN THIS
22
WHOLE CASE, LADIES AND GENTLEMEN, GOING FOR THE GRAND SLAM HOME
23
RUN.
24
ONLY TO PRESENT THE LONGER PERIOD WHICH TRANSLATES TO A LOT
25
MORE MONEY.
HE COULD DO THE ONE MONTH, HAD DONE IT BEFORE, BUT CHOSE
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AS DR. CHEVALIER TESTIFIED -- THIS IS SLIDE 7 -- IN HIS
FIRST SET OF CALCULATIONS, THE DIFFERENCE BETWEEN ONE MONTH OFF
THE MARKET AND FOUR MONTHS OFF THE MARKET WAS HUNDREDS OF
MILLIONS OF DOLLARS.
ON CROSS-EXAMINATION, HE TOLD US -- SLIDE 8 -- HE SAID HE
HAD NOT DONE THE ONE MONTH CALCULATION, BUT ACKNOWLEDGED THAT
IT WOULD BE A VERY SMALL NUMBER.
8
9
I CONFRONTED HIM WITH IT.
FOR ONLY ONE MONTH, IT'S ONLY $17.5 MILLION, ISN'T IT, SIR?"
10
11
I SAID, "IF YOU RAN THAT NUMBER
AND HE SAID, "I DON'T KNOW, I CAN'T DO THE MATH SITTING

HERE.
IT DOES BECOME QUITE SMALL.
12
"YOU HAVEN'T DONE THAT CALCULATION, SIR?
13
"NO.
14
HE WASN'T TELLING THE TRUTH.
15
16
I KNOW IT'S A SMALL NUMBER."

HE WASN'T TELLING THE TRUTH.
HE HAD DONE THAT CALCULATION.

REMEMBER, THIS IS A GUY THEY'VE HIRED 15 TIMES NOW.
THIS
17
CASE ALONE THEY PAID HIM $2.3 MILLION.
18
IN HERE AND PRESENT A $17.5 MILLION NUMBER.
19
DO THAT ARITHMETIC THAT HE HAD DONE BEFORE, COULD DO AGAIN TO
20
SHOW WHAT ONE MONTH OFF THE MARKET DAMAGES WOULD BE.
21
22
23
HE WASN'T GOING TO COME

HE WASN'T GOING TO
WE KNOW THAT FOR TWO OF THE PATENTS, THAT NUMBER IS ZERO.

THIS WAS UNCONTRADICTED TESTIMONY OF DR. CHEVALIER.
AND I THINK THIS IS PART OF THE REASON WHY DR. VELLTURO
24
DIDN'T COME BACK AND TAKE THE STAND.
25
HE WAS HERE.
I'LL TALK ABOUT IT MORE.
HE DIDN'T COME BACK AND EXPLAIN BECAUSE HE DIDN'T
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2
WANT TO BE ASKED THAT QUESTION, WHAT IS THE ONE MONTH?

AND WE WOULDN'T NEED FOUR MONTHS.
YOU KNOW, WE'RE TALKING
ABOUT SAMSUNG, ONE OF THE, YOU KNOW, GREATEST, LARGEST, MOST
IMPORTANT TECHNOLOGY COMPANIES IN THE WORLD.
THESE CHANGES, IF THEY HAD TO DO IT, IN ONE MONTH.
EVIDENCE ON THAT -- SLIDE 10 -- THE TESTIMONY OF DR. GREENBERG.
HE SAID THAT, YOU KNOW, THE CIRCLE UNLOCK, WE ALREADY HAD IT,
WE COULD SIMPLY SWAP THAT OUT.
THEY COULD DO
HERE'S THE
SLIDE 11, THE TESTIMONY OF YOUNGMI KIM, WE ASKED HER, HOW
10
LONG DID IT TAKE YOU TO COME UP WITH THE RIPPLE DESIGN?
11
SAID ABOUT 280 HOURS.
12
SLIDE 12, HOW ABOUT THE CIRCLE UNLOCK, HOW LONG DID IT
13
TAKE YOU TO COME UP WITH THAT?
14
MONTH TO DO THAT.
15
SHE SAID, WELL, IT TOOK ABOUT A
YOU KNOW, WORD SUGGESTION -- THIS IS PROFESSOR WIGDOR --
16
WE ALREADY HAD THE DART KEYBOARD.
17
THE GALAXY S III.
18
DART PHONE IN JUNE OF 2011.
19
20
21
22
23
SHE
IT WAS ALSO RELEASED WITH
WE HAD ORIGINALLY RELEASED IT ON -- WITH THE

HUGELY SUCCESSFUL.
WE HAD THOSE ALTERNATIVES.
THEY'RE IN THE CAN.
IT WOULD
HAVE BEEN NO CHALLENGE JUST TO SIMPLY SWAP THOSE OUT.

FOUR MONTHS TO DO THAT?
GIVE ME A BREAK.
NO EVIDENCE WAS
PRESENTED TO YOU.
SLIDE 14.
THE OTHER -- YOU KNOW, THE ANALYZER SERVER
24
PATENT, SOMETIMES CALLED LINKS TO STRUCTURES, YOU HEARD THE
25
TESTIMONY FROM DIANNE HACKBORN.
YOU KNOW, YOU ONLY HAVE TO
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CHANGE ONE THING AND YOU NO LONGER INFRINGE.
THAT.
PATENT.
4
5
YOU REMEMBER
IT HAS TO PRACTICE EVERY SINGLE LIMITATION OF THE
SHE SAID MAKING THE CHANGE, SHE'S TALKING ABOUT THE CHANGE
IN THE MENU, IT COULD HAVE BEEN DONE IN A DAY.
ONE MONTH WAS PLENTY OF TIME.
SO WHAT IT APPLE'S FALLBACK POSITION ON THIS?
APPLE'S
FALLBACK POSITION IS, WELL, YOU MIGHT HAVE BEEN ABLE TO DO IT,
BUT THE CARRIERS WOULD OBJECT TO IT, OR THEY WOULD PUT YOU
10
THROUGH A BUREAUCRATIC PROCESS.
11
THE CARRIER APPROVAL IN TIME.
12
THAT MAKE NO SENSE AT ALL.
YOU WOULDN'T BE ABLE TO GET
YOU'VE SEEN THE TESTIMONY
13
ABOUT HOW THE CARRIERS ARE FRUSTRATED WITH APPLE.
14
CAPPING THEM.
15
THEY HAVE THE SUBSIDIES THAT THEY HAVE TO PAY.
16
17
THEY'RE
THEY'RE MORE EXPENSIVE BECAUSE THEY -- YOU KNOW,
WHY ON EARTH WOULD THE CARRIERS GET IN THE WAY AND BE AN

OBSTACLE TO OUR, YOU KNOW, IMPLEMENTING THESE CHANGES?
18
YOU HEARD THE TESTIMONY FROM MR. DICARLO -- SLIDE 15 -- HE
19
SAID WE CAN GET APPROVAL FROM CARRIERS LIKE, IN A MATTER OF
20
DAYS.
21
I DON'T HAVE TIME TO TALK ABOUT THE CAPACITY ISSUE.
22
HAVE TO PROVE THAT THEY WOULD HAVE THE CAPACITY -- THIS IS
23
SLIDE 57 -- THAT THEY WOULD HAVE THE MARKETING AND
24
MANUFACTURING CAPACITY.
25
THEY
YOU HEARD THE TESTIMONY OF MR. SEXTON -- SLIDE 16 AND
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17 -- HOW APPLE WAS CONSISTENTLY CAPACITY LIMITED IN BEING ABLE
TO MAKE THE IPHONE.
THE IDEA THAT IN ONE MONTH, OR EVEN FOUR MONTHS, THEY
COULD HAVE CRANKED UP THE LINE AND BEEN ABLE TO MAKE MILLIONS
MORE PHONES MAKES NO SENSE AT ALL.
THIRD, THE REASONABLE ROYALTY, THIS IS THE HYPOTHETICAL
NEGOTIATION.
EDGE -- DR. VELLTURO'S SO-CALLED EDGEWORTH BOX.
YOU KNOW, THIS IS, YOU KNOW -- SLIDE 18 -- THE
AND I JUST LOVE THIS LITTLE STORY.
HE COMES -- BASED ON
10
HAUSER, HE COMES UP WITH THESE NUMBERS HERE AND HE SAYS THE
11
PARTIES ARE GOING TO BE FAR APART IN THIS NEGOTIATION.
12
NOT GOING TO BE A WAY -- YOU KNOW, THEY'RE GOING TO BE AT AN
13
IMPASSE.
14
THE NUMBERS ARE FAR APART.
SO WHAT WOULD HAPPEN?
WHAT WOULD HAPPEN DID HE SAY?
15
TOTAL CAPITULATION BY SAMSUNG.
16
WE'LL PAY YOUR NUMBER.
17
YOU ASKED.
18
THERE'S
SAMSUNG WOULD SAY, OKAY, APPLE,
YOU KNOW, FORGET IT.
WE'LL PAY WHAT
YOU KNOW, I THINK IF THERE'S ONE THING YOU KNOW ABOUT
19
SAMSUNG, IT'S THAT THEY'RE NOT JUST SIMPLY GOING TO CAVE AND
20
CAPITULATE.
21
BUT DR. VELLTURO HAS AN ANSWER TO THAT.
22
SAMSUNG WOULD DO IT.
23
PRICES AND IT WOULDN'T AFFECT THEIR SALES AT ALL.
24
25
WHY?
WELL, YOU KNOW,
BECAUSE THEY'D JUST RAISE THEIR
IF ANY COMPANY COULD SIMPLY RAISE ITS PRICES WITH NO

IMPACT ON ITS SALES, ANY COMPANY WOULD DO THAT AND THEY
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WOULDN'T WAIT UNTIL SOME HYPOTHETICAL NEGOTIATION.
IT TOMORROW.
THEY'D DO
I MEAN, THIS IS JUST A FANTASY.
REMEMBER HOW PROFESSOR CHEVALIER CAME UP WITH A REASONABLE
ROYALTY USING FIVE DIFFERENT METHODS?
WENT THROUGH THEM ONE AT A TIME.
THIS IS SLIDE 20.
SHE
REMEMBER, THIS IS AN EXPERT THAT BOTH SETS OF LAWYERS AT
DIFFERENT TIMES HAVE RETAINED.
CREDIBLE THAN SOMEBODY THAT BOTH SIDES HAVE USED.
YOU CAN'T GET ANYBODY MORE
SHE WENT THROUGH THE BENCHMARKS, REAL WORLD BENCHMARKS.
10
THE ANALYTICAL APPROACH, YOU KNOW, TRYING TO SEE IF THERE'S
11
SOME CORRELATION BETWEEN PROFITABILITY AND THE USE OF THE
12
PATENTS, LOOKING AT THEIR OPERATING SYSTEM UPDATES, WHAT THEY
13
FILE WITH THE SEC, WHAT APPLE TELLS THE FEDERAL GOVERNMENT.
14
15
ITS UPDATES INCLUDING THINGS LIKE TURN-BY-TURN NAVIGATION,

FACETIME, FIND MY IPHONE.
16
WHAT THEY'RE WORTH, POSITIONS THAT THEY HAVE TAKEN, YOU
17
KNOW, IN OTHER CASES, LOOKING AT PRODUCT REVIEWS, THE REAL
18
WORLD PRICES FOR APPS, LOOKING AT ALL THESE THINGS.
19
AND THEN SHE LOOKED AT THE GEORGIA-PACIFIC FACTORS AND
20
SAID THAT SHOULD BE AN UPWARD ADJUSTMENT BECAUSE THEY ARE
21
COMPETITORS AND APPLE HAS A CERTAIN POLICY WITH RESPECT TO IT,
22
SO SHE ADJUSTED IT UPWARDS TO $.35, A ROYALTY OF $.35 A PHONE.
23
WHAT'S SIGNIFICANT ABOUT THIS?
SHE GAVE YOU REAL WORLD
24
DATA.
25
LOOKED AT 200 DIFFERENT SMARTPHONE LICENSES FOR THE PURPOSE OF
APPLE DID NOT COME IN HERE -- AND SHE ALSO SAID SHE
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2
3
4
DETERMINING THAT A LUMP SUM ROYALTY WOULD BE APPROPRIATE.

THEY DIDN'T PRESENT YOU WITH ANY REAL WORLD DATA AT ALL.
IT WAS ALL HAUSER.
IF WE LOOK AT SLIDE 21 -- THIS IS CONFIDENTIAL -- YOU CAN
GO BACK AND LOOK AT THIS.
REASONABLE ROYALTY OF -- REMEMBER, WE'RE NOT SAYING ANYTHING IS
OWED TO THEM -- BUT ASSUMING A REASONABLE ROYALTY WAS OWED,
THIS IS THE NUMBERS.
PATENT, BY PHONE, AND SHE GIVES A GROSS NUMBER DOWN THERE ON
10
THE BOTTOM.
11
WHEW.
12
(LAUGHTER.)
13
MR. QUINN:
THIS IS HER BREAKDOWN ASSUMING A
YOU KNOW, YOU HAVE TO LOOK AT IT BY
WHERE IS DR. VELLTURO?
WHERE WAS
14
DR. VELLTURO?
15
KNOW, HE WAS HERE MOST OF THE TRIAL, DISAPPEARED FOR A FEW
16
DAYS.
17
THEY BROUGHT HIM BACK.
18
YOU KNOW, WHEN DR. CHEVALIER TESTIFIED -- YOU
LAST MONDAY, DID YOU SEE HIM HERE?
THEY COULD HAVE CALLED HIM.
HE WAS SITTING HERE.
HE WAS HERE TO LISTEN TO WHAT
19
SHE HAD TO SAY.
20
IT, HE COULD HAVE GOTTEN UP AND TAKEN THE STAND.
21
22
23
24
25
IF HE HAD ANYTHING TO SAY IN RESPONSE TO REBUT
HE DIDN'T TAKE THE STAND.
HE LEFT SO MANY QUESTIONS
UNANSWERED.
AND I'M ABOUT TO GET THE HOOK HERE, SO I'M JUST GOING TO
JUMP FORWARD.
THAT NUMBER, YOU KNOW, $2 BILLION, YOU KNOW, IT'S THE
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POWER OF SUGGESTION, YOU KNOW?
HOW BIG IS A REDWOOD TREE?
IF I TELL YOU A REDWOOD TREE
IS 2,000 FEET HIGH, YOU'D SAY, NO, NO, IT'S NOT 2,000 FEET
HIGH.
IF I ASK YOU, WELL, HOW BIG DO YOU REALLY THINK IT IS?
AND YOU SAY -- WELL, IT'LL INFLUENCE YOU.
1500 FEET.
8
9
10
11
12
13
14
15
YOU'LL SAY, WELL,
OTHER PEOPLE, YOU DON'T GIVE THEM THAT NUMBER, YOU SAY,
HOW BIG IS A REDWOOD TREE?
THEY'LL SAY, OH, MAYBE 200, 300
FEET.
IT'S THE POWER OF SUGGESTION.
NUMBER OUT THERE.
THAT'S WHY THEY PUT THAT
IT'S THE ONLY REASON.
THEY'LL BE DANCING IN THE STREETS OF CUPERTINO IF YOU GIVE

THEM $100 MILLION.
THEY DON'T EXPECT IT.
AN UNSUPPORTED NUMBER -- DON'T COMPROMISE FOLKS.
16
DR. VELLTURO, REMEMBER, WHEN HE WAS ON THE STAND, I SAID, HOW
17
IS THE JURY GOING TO COME UP WITH THIS?
18
ONE NUMBER.
HAUSER GAVE THEM ONLY
WHAT ARE THEY GOING TO DO, DO THEIR OWN SURVEY?
19
HE SAYS, WELL, THE NUMBERS WOULD HAVE BEEN TO BE ADJUSTED.
20
WELL, THAT'S AN INVITATION TO YOU TO VIOLATE YOUR OATH AS
21
JURORS AND GO OUTSIDE THE EVIDENCE, BECAUSE HE ONLY PRESENTED
22
THE ONE NUMBER FROM HAUSER ON THOSE TWO BASES.
23
UNSUPPORTED.
24
25
IT'S COMPLETELY
AN UNSUPPORTED BIG NUMBER DOESN'T GET SUPPORTED BY

DIVIDING IT IN HALF OR DIVIDING IT BY 100.
YOU STILL MUST MAKE
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2
YOUR DECISION BASED ON THE EVIDENCE.

DON'T BE INFLUENCED -- THE WAY TO DEAL WITH AN OVERSTATED
BIG NUMBER IS NOT TO CREDIT IT, NOT TO ADJUST IT, NOT TO GIVE
IT ANY CREDENCE AT ALL BECAUSE IT'S NOT ENTITLED TO ANY
CREDENCE.
AND I JUST WANT TO CONCLUDE BY SAYING WHAT THIS CASE IS
REALLY ABOUT.
COMPETITION WITH APPLE AND IT'S REALLY -- AND ITS ONLY
COMPETITOR, AND THAT'S ANDROID.
10
IT REALLY IS ABOUT COMPETITION.
IT'S ABOUT
FOR THOSE PEOPLE WHO BELIEVE THAT APPLE HAS BEEN A GREAT
11
AMERICAN COMPANY AND ADMIRE APPLE FOR THE WONDERFUL THINGS THAT
12
IT'S DONE IN THE PAST, I THINK WHAT APPLE NEEDS TO UNDERSTAND
13
IS THAT THE ANSWER TO THAT INNOVATOR'S DILEMMA THAT STEVE JOBS
14
TALKED ABOUT IS NOT HERE IN COURTROOMS SUING PEOPLE.
15
THE ANSWER IS TO GO BACK AND COME OUT WITH SOME MORE GREAT
16
PRODUCTS, LIKE THAT WATCH WE'VE BEEN HEARING ABOUT, OR THE
17
PHONES, YOU KNOW, THE LARGE SCREEN PHONES THAT WE'VE BEEN
18
HEARING ABOUT, OR THE SET TOP BOX, THOSE KINDS OF THINGS.
19
THAT'S WHAT APPLE SHOULD GET BACK TO DOING.
20
THEY'LL FIND THE SOLUTIONS TO INNOVATION DILEMMA.
21
THEY WANT TO MONOPOLIZE THIS MARKET.
THAT'S WHERE
THEY WANT TO ATTACK
22
GOOGLE AND ANDROID BY ATTACKING THE MOST SUCCESSFUL ANDROID
23
MAKER.
24
25
IF THEY CAN CRIPPLE THE MOST SUCCESSFUL ANDROID MAKER,

THEY'LL GO A LONG WAYS TOWARD ACCOMPLISHING THEIR GOAL.
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THIS SUIT WAS A LONG SHOT.
WORTH A CHANCE.
SAMSUNG.
4
5
6
7
8
9
10
THEY CYNICALLY THOUGHT IT WAS
IT'S IN OUR BACKYARD.
AFTER ALL, THEY'RE
THEY CERTAINLY WEREN'T GOING TO TAKE ON THE LOCAL COMPANY,

GOOGLE, IN MOUNTAIN VIEW, AND THEY DIDN'T.
THEY KNOW THEY'RE NOT ENTITLED TO A NICKEL.
DON'T FALL
FOR IT.
WE KNOW YOU WON'T FALL FOR IT.
WE'RE COUNTING ON YOU TO
USE YOUR SENSE OF FAIRNESS AND YOUR COMMON SENSE.

THE PEOPLE OF SAMSUNG, MANY OF WHOM ARE HERE AND MANY OF
11
WHOM ARE IN THE OVERFLOW COURTROOM NEARBY, BELIEVE THAT SAMSUNG
12
CAN GET JUSTICE, YES, THAT SAMSUNG CAN GET JUSTICE HERE IN
13
APPLE'S BACKGROUND.
14
15
16
BASED ON THE EVIDENCE PRODUCED IN THIS TRIAL, YOU HAVE THE

TOOLS AND THE POWER TO MAKE SURE THAT JUSTICE IS DONE.
THANK YOU FOR YOUR SERVICE.
17
THE COURT:
18
MR. LEE:
19
THE COURT:
20
MR. LEE:
THANK YOU FOR YOUR ATTENTION.
THE TIME IS 2:05.
YOUR HONOR, I THINK I HAVE 29 MINUTES.

YOU HAVE 29 MINUTES, THAT'S CORRECT.
AND DO YOU WANT TO TAKE A BREAK AT THE
21
NORMAL TIME OR SHOULD WE JUST GO STRAIGHT THROUGH?
22
YOU AND THE JURY.
23
THE COURT:
24
BATHROOM BREAK NOW?
25
MR. LEE:
IT'S UP TO
OH, WOULD YOU LIKE TO TAKE JUST A QUICK
AND THEN GO STRAIGHT THROUGH?
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THE COURT:
2
3
OKAY.
LET'S JUST TAKE A TEN MINUTE BREAK.
THANK
THE COURT:
COURTROOM.
ALL RIGHT.
LET'S TAKE OUR TEN MINUTE BREAK.
THE COURT:
10
OKAY.
WELCOME BACK.
THANK YOU.
PLEASE TAKE A SEAT.
ARE YOU READY, MR. LEE?
11
MR. LEE:
12
THE COURT:
READY, YOUR HONOR.

ALL RIGHT.
2:17.
GO AHEAD, PLEASE.
(MR. LEE GAVE HIS REBUTTAL CLOSING ARGUMENT ON BEHALF OF
13
14
OKAY.
YOU.
I THINK SOMEONE HAS REQUESTED THAT.
THE PLAINTIFF.)
MR. LEE:
15
GOOD AFTERNOON, LADIES AND GENTLEMEN.
I'M
16
THE LAST PERSON THAT YOU HAVE TO LISTEN TO, THE LAST ARGUMENT
17
YOU'RE GOING TO HEAR, AND I'M GOING TO ASK YOU ONE THING AT THE
18
BEGINNING AND ONE THING AT THE END.
19
AND THE THING AT THE BEGINNING IS THIS:
YOU'VE HEARD FIVE
20
LAWYERS TALK TO YOU ABOUT SOME COMPLICATED MATERIAL, AND I HAVE
21
29 MINUTES, SO MY FIRST REQUEST IS, HANG IN THERE WITH ME.
22
I'LL GET IT DONE IN 29 MINUTES, OR LESS NOW.
23
WITH ME BECAUSE WE HAVE SOME IMPORTANT, IMPORTANT THINGS TO
24
SAY.
25
BUT HANG IN THERE
LADIES AND GENTLEMEN, THERE'S AN OLD SAYING AMONG TRIAL
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LAWYERS, AND IT GOES LIKE THIS:
FOCUS ON THE FACTS.
LAW.
ATTACK.
IF THE LAW IS GOOD FOR YOU, FOCUS ON THE
IF THE LAW AND THE FACTS ARE BAD FOR YOU, ATTACK.
ATTACK.
AND THAT HAS -- THAT IS WHAT SAMSUNG HAS DONE.
ATTACKED APPLE.
ATTACKED ITS EXECUTIVES.
HAS ATTACKED ITS LAWYERS.
9
10
IF THE FACTS ARE GOOD FOR YOU,
IT HAS ATTACKED ITS SCIENTISTS.
MR. PRICE:
SCOPE.
IT HAS
IT HAS
IT HAS ATTACKED ITS EXPERTS.
AND IT
THIS IS BEYOND THE
THIS IS SUPPOSED TO BE REBUTTAL TO THE OFFENSIVE CASE.
11
THE COURT:
12
MR. LEE:
OVERRULED.
YOU'VE HEARD THE WORDS IN OPENING,
13
DISHONEST, MISLEADING.
14
MISLEADING.
DISHONEST.
YOU'VE HEARD THEM AGAIN TODAY.

SHAM.
15
WHY DOES SAMSUNG RESORT TO THOSE CHARACTERIZATIONS?
16
BECAUSE, AS MR. MCELHINNY SHOWED, AND I WILL SHOW YOU ON
17
18
SAMSUNG'S CLAIMS, THE FACTS AND THE LAW ARE WITH APPLE.
NOW, YOU'VE BEEN WITH MR. KREVANS, MR. MCELHINNY, OUR
19
COLLEAGUES AND ME FOR A MONTH NOW.
I'LL LET YOU JUDGE, I'LL
20
LET YOU JUDGE WHETHER THE ATTACKING WERE FAIR.
21
I INSTEAD WILL CONCENTRATE ON THE EVIDENCE AND THE LAW.
22
AND I'LL ADDRESS SAMSUNG'S CLAIMS, AND I'D LIKE YOU TO DO
23
ONE THING AS WE DO IT.
FOCUS ON WHAT SAMSUNG SAYS WHEN IT'S
24
THE DEFENDANT, AND COMPARE THAT TO WHAT SAMSUNG SAYS WHEN IT'S
25
THE PLAINTIFF.
BECAUSE, LADIES AND GENTLEMEN, YOU WILL FIND
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THAT THEIR POSITIONS ARE IRRECONCILABLY INCONSISTENT, EXCEPT
FOR ONE THING, AND I'LL SHOW YOU THAT THEY'RE INCONSISTENT
ACROSS THE BOARD.
4
5
THE ONE EXCEPTION IS THIS:
IT'S SAMSUNG'S CONSTANT EFFORT
TO CHEAPEN THE VALUE OF THE PATENTS.
MR. JOHNSON GOT UP TO START HIS CLOSING ON SAMSUNG'S
PATENTS AND HE STARTED, HE STARTED TALKING ABOUT APPLE'S DAMAGE
CLAIM.
WELL, LADIES AND GENTLEMEN, WE DO HAVE THAT CLAIM.
10
NOT SOMETHING WE'VE MADE UP AS MR. QUINN SUGGESTS.
11
IN IT.
12
WE THINK IT'S ACCURATE.
IT'S
WE BELIEVE
WE STAND BY IT.
NOW, I BEGAN MY OPENING ON SAMSUNG'S PATENTS IN 2010,
13
AUGUST 2010, AND I'M GOING TO TAKE YOU BACK THERE NOW BECAUSE
14
YOU'VE HEARD A LITTLE BIT MORE ABOUT THAT MEETING.
15
AS YOU'VE NOW HEARD DIRECTLY, DIRECTLY FROM SAMSUNG'S
16
DIRECTOR OF LICENSING, JON WON LEE, HERE IS WHAT HAPPENED AT
17
THAT MEETING.
18
PATENTS.
19
PATENTS.
APPLE TOLD SAMSUNG THAT IT COPIED APPLE'S
APPLE TOLD SAMSUNG THAT IT HAD INFRINGED APPLE'S
20
MR. PRICE:
21
MR. LEE:
22
23
OBJECTION.
BEYOND THE SCOPE OF REBUTTAL.
IT IS NOT, YOUR HONOR.
THIS WAS THE
STARTING POINT FOR THE PURCHASE OF SAMSUNG'S PATENTS.

THE COURT:
OVERRULED.
24
GO AHEAD, PLEASE.
25
MR. LEE:
APPLE ASKED SAMSUNG TO STOP.
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AS I SAID TO YOU IN MY OPENING, THIS WAS A CRITICAL MOMENT
IN TIME.
SAMSUNG COULD HAVE STOPPED.
INVENTED, INNOVATED ON ITS OWN.
INFRINGING.
THEY COULD HAVE
THEY COULD HAVE STOPPED
OR IT COULD HAVE CHOSEN THE ALTERNATIVE.
AND THIS IS WHAT THE ALTERNATIVE WAS:
AFTER APPLE ASKED
THEM TO STOP COPYING, AFTER APPLE ASKED THEM TO STOP
INFRINGING, AFTER APPLE HAD SUED, SAMSUNG DECIDED TO PURCHASE
SOME PATENTS AND THEN SELECTED TWO OLD PATENTS TO SUE APPLE ON.
10
AND SAMSUNG CHOSE THOSE PATENTS, AND THEY CHOSE THOSE
11
PATENTS FOR A REASON, AND I THINK THE EVIDENCE WILL MAKE CLEAR
12
TO YOU JUST WHY.
13
NOW, MR. QUINN TOLD YOU IN HIS OPENING THAT SAMSUNG HAS
14
THE SECOND MOST PATENTS RECEIVED IN THE UNITED STATES FOR A
15
GIVEN YEAR.
16
AS WE TOLD YOU IN OUR OPENING, YOU WILL NOT SEE, AND YOU
17
HAVE NOT SEEN, ONE OF THOSE PATENTS.
18
SINGLE SAMSUNG PATENT THAT WAS INVENTED BY A SAMSUNG ENGINEER.
19
YOU HAVE NOT SEEN A SINGLE SAMSUNG PATENT THAT RESULTS FROM THE
20
WORK OF SAMSUNG.
21
YOU HAVE NOT SEEN A
AND AS I TOLD YOU, THERE IS A REASON FOR THAT.
AS WE SAID
22
IN OUR OPENING, THE REASON IS APPLE HAS BEEN THE INNOVATOR, AND
23
IN THIS FIELD, THE REASON YOU'RE NOT SEEING SAMSUNG PATENTS IS
24
SAMSUNG HAS BEEN THE FAST FOLLOWER.
25
YOU DON'T HAVE TO TAKE MY WORD FOR IT.
THIS IS DX 431,
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PAGE 5.
FOLLOWER.
THIS IS WHAT SAMSUNG SAID ABOUT ITSELF, A FAST
AND THIS IS WHAT MR. PENDLETON SAID UNDER
CROSS-EXAMINATION, AND IT'S IMPORTANT BECAUSE IT EXPLAINS WHY
YOU SEE THE TWO PATENTS THAT I'M GOING TO TALK TO YOU ABOUT
THIS AFTERNOON.
MR. PENDLETON ADMITTED JUST THIS.
"QUESTION:
9
10
A FAST FOLLOWER IS SOMEONE WHO LETS SOMEONE
ELSE INTRODUCE THE INNOVATIVE PRODUCT AND THEN QUICKLY FOLLOWS

WITH THEIR OWN PRODUCT; CORRECT?
11
"THAT IS CORRECT.
12
"QUESTION:
13
CORRECT?
14
"ANSWER:
15
"QUESTION:
16
SAMSUNG HAS BEEN CALLED A FAST FOLLOWER;
YES.
IT HAS BEEN SPECIFICALLY CALLED A FAST
FOLLOWER IN THE SMARTPHONE WORLD; CORRECT?
17
"CORRECT."
18
NOW, THERE'S A SECOND REASON YOU HAVEN'T SEEN A SAMSUNG
19
PATENT ASSERTED AGAINST US, AND MR. PENDLETON GAVE YOU THAT
20
ANSWER AS WELL.
21
OF ITS PATENTS FOR PENNIES A UNIT.
22
HE TOLD YOU THAT SAMSUNG WOULD NOT LICENSE ONE
SAMSUNG WAS NOT GOING TO COME BEFORE YOU WITH A PATENT
23
THAT RESULTED FROM SAMSUNG WORK, LIKE NEAR FIELD COMMUNICATION,
24
AND TELL YOU THAT IT WAS INFRINGED, BUT THAT IT WOULD LICENSE
25
IT FOR $.35 A UNIT.
IT WASN'T GOING TO SAY THAT.
IT COULDN'T
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SAY THAT.
MR. PENDLETON TOLD YOU THAT.
SO WHAT DID SAMSUNG DO?
SAMSUNG WENT OUT AND PURCHASED A
GROUP OF PATENTS AND IT SELECTED TWO OLDER PATENTS TO PUT
BEFORE YOU TO CLAIM THAT THE PATENTS WERE NOT WORTH MUCH.
NOW, THE EVIDENCE ESTABLISHES BOTH PATENTS, BOTH PATENTS
PURCHASED BY SAMSUNG AND PUT BEFORE YOU WERE OLD TECHNOLOGIES.
THE EVIDENCE ESTABLISHED, AND I'LL GO THROUGH IT IN A
LITTLE BIT MORE DETAIL, THAT THE IPHONE AND THE IPOD TOUCH USE
DIFFERENT TECHNOLOGIES.
10
MR. GARCIA AND MR. MILLET CAME AND APPEARED BEFORE YOU.
11
THEY DESCRIBED THE ENORMOUS INVESTMENT OF TIME AND EFFORT IN
12
DEVELOPING THESE NEW TECHNOLOGIES, THE TECHNOLOGIES THAT
13
SAMSUNG NOW SAYS INFRINGES.
14
THERE IS NOT A SHRED OF EVIDENCE THAT THE PATENTS WERE
15
COPIED, THAT THE TECHNOLOGY WAS COPIED, THAT THE PRODUCTS WERE
16
COPIED.
17
AND I SHOULD SAY PARENTHETICALLY, THERE'S BEEN SOME TALK
18
ABOUT COPYING A PATENT.
19
APPLICATION GETS FILED, BUT IT DOESN'T ISSUE FOR SEVERAL YEARS,
20
BUT IN THE MEANTIME, THERE'S A LOT OF --
21
22
MR. PRICE:
THIS IS NOT
OFFENSIVE CASE.
23
THE COURT:
24
MR. LEE:
25
AS YOU KNOW FROM THE VIDEO, A PATENT
OVERRULED.
THE EVIDENCE HAS REVEALED TO YOU JUST WHY
SAMSUNG SELECTED THESE TWO OLD PATENTS.
SAMSUNG'S TOTAL
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DAMAGES, AS MR. JOHNSON TOLD YOU, FOR THESE TWO PATENTS IS JUST
OVER $6 MILLION.
6,158,000.
LET'S START WITH THE '449.
DO YOU REMEMBER MR. PARULSKI, WHO TESTIFIED AS SAMSUNG'S
EXPERT?
HE TOLD YOU THAT HE HAS BEEN PAID 250,000 ALONE.
DOES IT MAKE SENSE TO YOU THAT SOMEONE WOULD PAY $250,000
TO AN EXPERT, SETTING ASIDE WHAT THE LAWYERS ARE GETTING PAID,
TO PURSUE A $168,000 CLAIM?
IT MAKES SENSE ONLY IF YOU HAVE ONE PURPOSE, TO TRY TO
10
CONVINCE FOLKS, FOLKS LIKE YOU, THAT THE PATENTS AREN'T WORTH
11
MUCH.
12
YOU ALSO NOW KNOW THAT THEY HIRED FOUR EXPERTS,
13
DR. SCHONFELD, DR. RAO, MR. PARULSKI, AND DR. KEARL, WHO IN
14
TOTAL WERE PAID OVER $5 MILLION -- AGAIN, WITHOUT WHAT THE
15
LAWYERS HAVE BEEN PAID -- TO PURSUE A $6 MILLION CLAIM.
16
17
18
DOES THAT MAKE SENSE?
ONLY IN ONE CIRCUMSTANCE, IF YOU'RE
TRYING TO DEVALUE PATENTS, ALL PATENTS.

AND THIS WAS AN INTENTIONAL STRATEGY.
AS DR. KEARL
19
TESTIFIED DURING HIS QUICK TESTIMONY ON DAMAGES, HE USED A $.99
20
UPGRADE FOR FACETIME IN HIS ANALYSIS.
21
22
23
BUT ON CROSS-EXAMINATION, HE AGREED THAT THE ACTUAL VALUE

OF FACETIME WAS MANY, MANY TIMES HIGHER.
WHY WOULD YOU USE -- WHY WOULD YOU USE AN ARTIFICIALLY LOW
24
NUMBER?
ONLY ONE REASON.
THEY'RE THE PLAINTIFF.
25
REASON.
TO DEVALUE, TO CHEAPEN, TO CONVINCE YOU THAT THE
ONLY ONE
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PATENTS ARE NOT WORTH MUCH.

BUT THIS STRATEGY OF DEVALUING PATENTS WAS NOT IN
ISOLATION.
MR. PRICE TOLD YOU IN HIS OPENING TODAY THAT IT'S
IMPORTANT TO LOOK AT WHAT WAS GOING ON WHEN THESE EVENTS WERE
OCCURRING.
PATENTS WERE PURCHASED.
THIS IS 2011, JUNE TO SEPTEMBER, 2011, WHEN THESE
SO WHAT ELSE WAS SAMSUNG DOING?
YOU HAVE SEEN AND HAD IT DESCRIBED BY MR. SOHN IN PART,
AND ONE OF THE EXHIBITS THAT CAME IN FROM MR. SOHN IS PX 215,
10
AND THIS IS EXACTLY IN THIS PERIOD OF TIME WHEN THESE PATENTS
11
ARE BEING PURCHASED.
12
13
ON OCTOBER 4, 2001 -- I'M JUST GOING TO TELL YOU WHAT'S IN

THE E-MAIL.
14
15
LET ME SHOW YOU.
ON OCTOBER 4, 2001, MR. PENDLETON WRITES --
MR. PRICE:
THIS IS WAY BEYOND
THE SCOPE OF REBUTTAL.
16
MR. LEE:
YOUR HONOR --
17
MR. PRICE:
AND WE KNOW WHAT ARGUMENT --
18
THE COURT:
OKAY.
EXCUSE ME.
MR. LEE IS COVERING
19
THE DEFENSIVE CASE TO SAMSUNG'S AFFIRMATIVE CASE.
THIS WAS AT
20
SAMSUNG'S REQUEST THAT WE ORDER THE CLOSINGS THIS WAY.
21
LIKE HIM TO CONTINUE.
I WOULD
22
THE OBJECTION'S OVERRULED.
2:27 IS THE TIME.
23
AND SAMSUNG'S CLOSING WAS FOUR MINUTES OVER, SO IF YOU'RE
24
GOING TO KEEP OBJECTING, I MAY GIVE THOSE FOUR MINUTES TO
25
APPLE.
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IT'S 2:27.
GO AHEAD, PLEASE.
MR. LEE:
ON OCTOBER 4, 2001, MR. PENDLETON WRITES,
"IT CONTINUES TO BE SAMSUNG'S POSITION TO AVOID ATTACKING APPLE
DUE TO THEIR STATUS AS A LARGE CUSTOMER."
2011, RIGHT IN THE MIDDLE OF THESE PURCHASE OF PATENTS.
6
7
THAT'S OCTOBER 4TH,
THREE DAYS LATER, THEY CHANGE THEIR MIND.
THREE DAYS
LATER, THEY SAY, "THIS IS OUR BEST OPPORTUNITY TO ATTACK."
"ATTACK" IS NOT MY WORD.
SO WHAT HAS CHANGED DURING THAT TIME?
10
YOU.
11
LAUNCHED.
IT'S THEIR WORD.

THE E-MAIL TELLS
FIRST IT TELLS YOU THAT ON OCTOBER 4TH, THE IPHONE 4S WAS

IT WAS ENORMOUSLY SUCCESSFUL.
12
SECOND, IT TELLS YOU EXPLICITLY THAT MR. JOBS DIED.
13
AND WHAT IS THE PLAN?
HERE IS WHAT THE E-MAIL SAYS, THREE
14
DAYS LATER, "WE'RE GOING TO ATTACK AS A VERY AGGRESSIVE
15
STRATEGY," AND THIS PURCHASE OF PATENTS, AND THE ASSERTION OF A
16
PATENT, SPENDING MILLIONS OF DOLLARS TO TRY TO CONVINCE YOU
17
THAT PATENTS DON'T HAVE MUCH VALUE ARE PART, PART OF THIS PLAN
18
TO ATTACK.
19
NOW, LET ME TURN QUICKLY TO THE PATENTS BECAUSE I THINK
20
WHEN YOU LOOK AT THE PATENTS, YOU'LL ACTUALLY BE ABLE TO SEE
21
THE INCONSISTENCY WITH THE POSITIONS.
22
IF YOU REMEMBER MR. PARULSKI AND MR. SCHONFELD, THEY
23
TESTIFIED THAT THESE TWO PATENTS ARE -- AND I HAVE IT ON THE
24
SCREEN NOW -- FUNDAMENTAL AND REVOLUTIONARY.
25
SAID.
THAT'S WHAT THEY
THESE PATENTS ARE FUNDAMENTAL AND REVOLUTIONARY.
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SAMSUNG CHARACTERIZED THESE PATENTS AS FUNDAMENTAL AND
REVOLUTIONARY TO YOU, EVEN THOUGH ITS OWN EXPERTS HAD NEVER
HEARD OF THE PATENTS BEFORE THE LAWYERS HANDED THEM TO THEM,
EVEN THOUGH ITS OWN LAWYER -- EVEN THOUGH ITS OWN EXPERTS HAD
NEVER HEARD OF THE INVENTORS BEFORE THE LAWYERS HANDED THE
PATENTS TO THEM.
SAMSUNG CHARACTERIZED THESE PATENTS AS FUNDAMENTAL AND
REVOLUTIONARY EVEN THOUGH IT COULD NOT SHOW YOU A SINGLE MODERN
DAY PRODUCT, NOT A SINGLE MODERN DAY PRODUCT THAT USED THESE
10
11
INVENTIONS.
AND THEY CHARACTERIZED THEM AS FUNDAMENTAL AND
12
REVOLUTIONARY EVEN THOUGH THERE WAS ABSOLUTELY NO EVIDENCE THAT
13
ANYBODY COPIED THE PATENTS, COPIED THE PRODUCTS THAT THEY
14
INTRODUCED EARLIER, OR COPIED THE TECHNOLOGY.
15
16
17
18
BUT THEN THEY SAY THAT APPLE'S PATENTS ARE TRIVIAL AND
NARROW.
I'LL ASK YOU THE SAME QUESTION THAT THEY HAVE ASKED YOU.
DOES THAT MAKE SENSE?
19
NOW, THE '239 PATENT IS THE FIRST OF THE TWO PATENTS.
20
IS, AS YOU NOW KNOW, ABOUT 20 YEARS OLD AND IT HAS EXPIRED.
21
I DON'T DISAGREE WITH MR. JOHNSON.
IT
THAT DOESN'T MEAN THAT
22
THEY CAN'T GET DAMAGES DURING THE PERIOD THAT THE PATENT WAS IN
23
EFFECT.
24
25
BUT THIS IS WHERE WHAT MR. MCELHINNY SAID IS IMPORTANT.

IT IS SO IMPORTANT TO WATCH WHAT PEOPLE DID RATHER THAN WHAT
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THEY SAY TODAY THEY COULD HAVE DONE.

WHAT HAPPENED IN THE 15 YEARS BEFORE THIS PATENT WAS
ACQUIRED BY SAMSUNG?
PRODUCTS ACCUSED OF INFRINGING.
APPLE'S PRODUCTS WERE ON THE MARKET, THE
DID VOCI, WHO OWNED THE PATENT, EVER ONCE SUGGEST, EVEN
THOUGH IT HAD A PATENT BROKER UP THERE TRYING TO SELL THE
PATENT, DID THEY ONCE SUGGEST THAT APPLE WAS INFRINGING?
AND THERE'S A REASON.
AND THE REASON IS THAT THE PATENT COVERS A VERY SPECIFIC
10
IMPLEMENTATION OF AN OLDER TECHNOLOGY THAT YOU DON'T NEED
11
TODAY.
12
NO.
YOU MAY RECALL, WHEN I WAS CROSS-EXAMINING DR. SCHONFELD,
13
I TRIED TO GET HIM TO SAY YES OR NO, WHAT WAS IN THE PATENT,
14
AND WE HAD A LITTLE BIT OF TROUBLING GETTING THERE.
15
16
17
THERE'S A REASON HE DIDN'T WANT TO ACKNOWLEDGE WHAT WAS IN

THE PATENT, BECAUSE THE PATENT GIVES YOU THE ANSWER.
THE PATENT TALKS IN TERMS OF ANALOG VIDEO, LIKE OUR OLD
18
ANALOG PHONES, OUR OLD ANALOG TV'S.
19
CAMERAS AND VCR'S.
20
IT TALKS ABOUT VIDEO
IT HAS A FIGURE 1 IN THE PATENT WHICH TELLS YOU EVERYTHING
21
YOU NEED TO KNOW AS YOU TRY TO UNDERSTAND WHAT THE PATENT
22
CLAIMS.
23
THAT FIGURE 1 DESCRIBES A REMOTE UNIT.
THE REMOTE UNIT DOESN'T RECORD, THOUGH.
THE REMOTE UNIT
24
CAPTURES VIDEO THAT HAS BEEN RECORDED ELSEWHERE, THE VIDEO
25
CAMERA HERE, AND THEN, AND ONLY THEN, DOES IT DO SOMETHING WITH
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IT.
2
3
YOU SAW THE INVENTOR'S FIRSTLOOK PRODUCT FROM THE EARLY

1990S.
NOW, I'M NOT SUGGESTING THAT YOU SHOULD COMPARE THIS TO
APPLE'S IPHONE TO MAKE YOUR INFRINGEMENT DETERMINATION.
DON'T NEED TO.
BUT IT TELLS YOU A LOT ABOUT WHAT THE TERMS IN THE PATENT
MEAN.
POUNDS, AND IT WAS DESIGNED TO BE USED WITH ANALOG VIDEO
IT WAS DESIGNED IN THE EARLY 1990S, IT WAS WEIGHED 28
10
CAMERAS.
11
BETA, 8 MILLIMETER.
12
YOU
AND IT SAYS RIGHT IN THE BROCHURE, AT PX 251, VHS,
LADIES AND GENTLEMEN, THIS IS THE ONLY PRODUCT THAT YOU
13
HAVE SEEN THAT PRACTICES THIS INVENTION.
14
APPLE'S PRODUCTS, SAMSUNG HAS NOT IDENTIFIED FOR YOU A SINGLE
15
OTHER PRODUCT -- AND THIS HAS BEEN OFF THE MARKET FOR 15
16
YEARS -- THAT USES THIS INVENTION.
17
18
19
OTHER THAN ACCUSING
DID THEY SHOW YOU A SINGLE SAMSUNG PRODUCT THAT USES THIS
INVENTION?
THEY CALL THIS INVENTION FUNDAMENTAL.
BUT THEY DIDN'T TELL YOU THAT THERE'S EVEN A SAMSUNG
20
PRODUCT THAT USES IT.
21
FORWARD.
WHY?
BECAUSE TECHNOLOGY HAS MOVED
22
AND DR. STORER EXPLAINED JUST THAT TO YOU.
23
IF WE PUT ON THE SCREEN CLAIM 15, THIS IS WHAT MR. JOHNSON
24
PUT UP THERE, BUT HE NEVER USED THE WORDS IN HIS CLOSING "VIDEO
25
CAPTURE MODULE."
THAT'S A TERM IN THE PATENT, VIDEO CAPTURE
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MODULE.
2
3
AND AS HER HONOR HAS EXPLAINED TO YOU, YOU ARE TO USE THE
PLAIN AND ORDINARY MEANING OF THAT BACK IN 1994.
4
5
SO WHAT WAS THE PLAIN AND ORDINARY MEANING?
WHAT WAS A
VIDEO CAPTURE MODULE IN 1994?
THE PATENT AND THE EVIDENCE TELLS US.
IT WAS A COMPONENT
THAT YOU COULD GO OUT AND BUY, THAT YOU COULD SNAP ON A VIDEO
CARD AND INSTALL IN YOUR COMPUTER.
THE SCREEN NOW FROM PX 248.
10
USED IT.
11
IT LOOKS LIKE THE ONE ON
MR. FREEMAN USED IT.
DR. STORER
EVEN MR. GARCIA'S COLLEGE ROOMMATE USED IT.
REMEMBER, LADIES AND GENTLEMEN, THE WORDS IN THE
12
SPECIFICATION, THESE AREN'T RANDOM WORDS.
13
THAT THE INVENTORS PUT DOWN IN THEIR ORIGINAL APPLICATION.
14
THIS IS WHAT THEY WROTE IN 1994.
15
THESE ARE THE WORDS
AND THE PATENT DESCRIBES A VIDEO CAPTURE MODULE, JUST AS
16
DR. STORER DESCRIBED IT AND EXACTLY AS THE TYPE OF PRIOR ART
17
THAT COULD BE BOUGHT WITH A VIDEO CARD AND INSTALLED IN YOUR
18
COMPUTER.
THE PATENT TELLS YOU THAT.
19
DR. STORER TOLD YOU THAT AS WELL.
20
APPLE'S IPHONE PRODUCTS DON'T HAVE ONE.
21
ONE.
WE TAKE DIGITAL VIDEO.
22
VIDEO TO DIGITAL VIDEO.
23
NEED TO CAPTURE IT ANYWHERE ELSE.
THEY DON'T NEED
THE WORLD HAS MOVED FROM ANALOG
WE TAKE DIGITAL VIDEO AND THERE'S NO
24
THAT'S WHY, WHEN SAMSUNG CLOSED TODAY, THEY REFERRED YOU
25
TO PHRASES LIKE "CAPTURE VIDEO" DESCRIBING THE RECORDING OF IT
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AND THEY NEVER USED THE WORDS "VIDEO CAPTURE MODULE."
AND THERE'S A SIMPLE REASON.
WE DON'T HAVE THAT.
DR. SCHONFELD AND DR. STORER BOTH LOOKED AT THE BILL OF
MATERIALS.
THE ACCUSED PRODUCTS RIGHT DOWN TO THE LAST SCREW -- YOU WILL
HAVE THEM BEFORE YOU -- LITERALLY TO THE LAST SCREW.
NO -- THERE IS NO VIDEO CAPTURE MODULE.
8
9
10
WHY?
THE BILL OF MATERIALS HAS EVERY SINGLE COMPONENT OF
BECAUSE WE RECORD DIGITAL VIDEO.
WE DON'T NEED TO
CAPTURE IT FROM SOMEWHERE ELSE.

IN THE SAME WAY, THERE'S MEANS FOR TRANSMISSION, AND I'LL
11
JUST SAY THIS TO GUIDE YOU IN YOUR DELIBERATIONS.
12
THE SECOND PART HAS THAT MEANS OF TRANSMISSION.
13
THERE'S
CLAIM 15 IN
WHEN YOU LOOK AT HER HONOR'S FINAL INSTRUCTION NUMBER 27,
14
YOU WILL SEE SHE SAYS THIS TYPE OF CLAIM, AMONG ALL THE CLAIMS
15
YOU HAVE TO CONSIDER, HAS A SPECIAL MEANING, AND THAT SPECIAL
16
MEANING IS THEY HAVE TO SHOW THAT THE SPECIFIC STRUCTURE, THE
17
SPECIFIC STRUCTURE THEY DESCRIBED 20 YEARS AGO, IS IN OUR
18
PRODUCT.
19
AND THAT'S WHAT'S REQUIRED.
20
THAT'S WHAT HER HONOR'S CLAIM INTERPRETATION SAYS,
THEY CAN'T DO IT.
THEY CAN'T DO IT BECAUSE THERE ARE NO
21
PORTS TO PLUG CABLES IN BECAUSE WE DON'T NEED THEM.
22
NO MODEMS OUTSIDE OF THE TELEPHONE BECAUSE WE DON'T NEED THEM.
23
THE SPECIFIC THINGS THAT HER HONOR HAS IDENTIFIED SIMPLY
24
25
THERE ARE
AREN'T IN THE APPLE PHONE BECAUSE WE DON'T NEED THEM.

NOW LET'S LOOK AT THE '449 PATENT, AND LET ME ADDRESS ONE
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THING FIRST, WHICH IS THIS ATTACK ON DR. STORER'S
QUALIFICATIONS.
THIS PATENT IS ABOUT DATA COMPRESSION AND DATA
DECOMPRESSION.
YOU THAT.
MR. PARULSKI TOLD YOU THAT.
DR. STORER TOLD
AS BETWEEN THE TWO OF THEM, THE PERSON WHO HAS THE REAL
EXPERIENCE IN DATA COMPRESSION AND DECOMPRESSION IS ACTUALLY
DR. STORER.
BUT YOU DON'T HAVE TO TAKE MY WORD FOR IT.
WHEN NASA,
10
RIGHT, THE NATIONAL AERONAUTICS SPACE AGENCY, NEEDED SOMEONE TO
11
COME IN AND CONSULT ON DATA DECOMPRESSION AND DATA COMPRESSION,
12
WHO DID THEY GO TO?
THEY WENT TO DR. STORER.
13
NOW, WHAT DR. STORER TOLD YOU IS THERE ARE FIVE SEPARATE
14
REASONS, FIVE SEPARATE REASONS THAT THE MODERN DAY FACETIME IN
15
IPHONE DOESN'T USE THE CLAIMED INVENTION.
16
THROUGH ALL FIVE.
17
I'M NOT GOING TO GO
INSTEAD I'M GOING TO IDENTIFY TWO FOR YOU.
THE FIRST IS THIS.
THERE IS A REQUIREMENT OF A LIST IN A
18
SEARCH MODE.
19
ACKNOWLEDGED IS THIS:
20
POSSIBLE TO DISPLAY ALL THE PHOTOS IN THE CAMERA AND SIMPLY
21
SCROLL THROUGH THEM.
22
WHAT THE PATENT TELLS US AND WHAT MR. PARULSKI

THE INVENTION EXISTED BECAUSE IT WAS NOT
THE PATENT SAYS THAT.
BUT MR. PARULSKI SAID IT IN HIS TRIAL TESTIMONY
23
EXPLICITLY, AND IF I CAN PUT THAT ON THE SCREEN.
24
PURPOSE OF THIS WAS YOU CAN'T PUT ALL OF THE PICTURES UP AT
25
ONCE.
THE TECHNOLOGY WON'T ALLOW IT.
THE WHOLE
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SO WHAT ARE WE GOING TO DO?
WE'RE GOING TO HAVE A SEARCH MODE.
FIGURES 4 AND 7.
WE'RE GOING TO HAVE A LIST.

AND THAT'S WHAT'S SHOWN AT
DR. STORER ALSO EXPLAINED TO YOU THAT IN THE OLD
TECHNOLOGY, THERE WAS A REASON TO HAVE WHAT THE PATENT CLAIMS
AS A SINGLE COMPRESSOR BECAUSE THE COMPRESSION TECHNIQUES FOR
VIDEO AND STILL IMAGES OVERLAPPED AT THE TIME.
8
9
BUT TODAY, THEY'RE DIFFERENT, VERY DIFFERENT, AND

COMPLETELY DIFFERENT.
10
AND AS A CONSEQUENCE, IF YOU LOOK AT SDX 3729, WHICH I'M
11
GOING TO PUT ON JUST YOUR SCREENS RIGHT NOW, YOU WILL SEE THAT
12
THERE ARE TWO DIFFERENT COMPONENTS EMPLOYING TWO DIFFERENT
13
METHODOLOGIES MADE BY TWO DIFFERENT SUPPLIERS.
14
CLOSE TO SATISFYING THE LIMITATIONS.
15
AND THEY'RE DIFFERENT FOR A REASON.
16
TECHNOLOGY NEEDS TO BE DIFFERENT.
17
TECHNOLOGY.
18
THEY DON'T GET
THE MODERN DAY
THEY CAN'T BE 20 YEAR OLD
NOW, MR. JOHNSON MENTIONED, AND I AGREE WITH HIM, SOME OF
19
THE COMPONENTS THAT ARE ACCUSED OF INFRINGING CAME FROM
20
SAMSUNG.
21
THIS IS IMPORTANT FOR TWO REASONS.
HERE IS THE FIRST.
22
SAMSUNG BOUGHT THESE PATENTS IN 2011.
THEY DIDN'T SUE US UNTIL
23
APRIL OF 2012.
24
OF DOLLARS OF COMPONENTS, BILLIONS OF DOLLARS OF COMPONENTS,
25
AND THEN THEY SUED US AND THEY NOW CLAIM THAT WE'RE INFRINGING
FOR SEVEN MONTHS THEY WERE SELLING US BILLIONS
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THIS PATENT, THE PATENT THEY PURCHASED, BY USING THE COMPONENTS
THEY SOLD TO US.
THAT THEY SOLD TO US WHILE THEY HELD THE PATENTS AND WE BOUGHT
THEM.
THEY WANT $6 MILLION FOR USING COMPONENTS
NOW, IT'S IMPORTANT FOR A SECOND REASON, AND HERE'S WHAT
IT IS.
THAT WE BOUGHT THE COMPONENTS FROM SAMSUNG.
8
9
10
MR. JOHNSON SAID IT'S NO DEFENSE TO PATENT INFRINGEMENT
HE'S RIGHT.
I AGREE.
IT'S NOT A DEFENSE IF YOU'RE THE
MAKER OR USER OR SELLER OF A COMPONENT TO A CLAIM OF PATENT

INFRINGEMENT.
11
IT APPLIES TO OUR PURCHASE OF COMPONENTS FROM SAMSUNG.
12
IT APPLIES TO SAMSUNG'S USE OF GOOGLE SOFTWARE.
13
IT DOESN'T MATTER WHERE IT COMES FROM IF YOU'RE THE
14
15
PERSON, IF YOU ARE THE PERSON WHO USES IT.

NOW, DAMAGES QUICKLY, AND HERE IS THE MOST IMPORTANT THING
16
ABOUT THE DAMAGES CLAIM.
17
DR. HAUSER FOR THE LAST HALF HOUR OR SO, ATTACK HIS STUDY AS
18
DISHONEST AND A SHAM.
19
YOU'VE HEARD MR. QUINN ATTACK
WHAT DID SAMSUNG DO WHEN IT WAS ITS TURN TO PROVE DAMAGES?
20
REMEMBER, THE SHOE IS NOW ON THE OTHER FOOT.
21
WHAT DID THEY DO?
22
23
24
25
ASK YOURSELF,
DID THEY HAVE DR. ERDEM DO AN EYE TRACKING STUDY TO PROVE

THEIR DAMAGES?
NO.
DID THEY HAVE DR. CHEVALIER DO A LINE COUNTING STUDY TO

PROVE THEIR DAMAGES?
NO.
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DID THEY DO WHAT MR. WAGNER SAID, A CONJOINT STUDY?
NO.
INSTEAD, THEY BROUGHT DR. RAO IN, WHO TESTIFIED FOR EIGHT
MINUTES, AND HE PRESENTED YOU WITH A SURVEY, A MAX DIFF SURVEY
THAT, LIKE DR. ERDEM'S STUDY, LIKE DR. CHEVALIER'S STUDY, HAS
NEVER BEEN USED IN A COURT IN AMERICA TO DETERMINE DAMAGES.
HE SHOWED YOU HIS SURVEY SHEET, HE DESCRIBED THE DATA
POINTS, AND HE SAID THAT'S ENOUGH.
8
9
NOW, LADIES AND GENTLEMEN, WHEN YOU RETIRE TO THE JURY

ROOM AND YOU CONSIDER THE ATTACKS ON DR. HAUSER, ASK YOURSELF
10
THIS:
11
KNOW, THE AMOUNT DOESN'T MATTER, IT'S THE ANALYTICAL FRAMEWORK
12
YOU USE, IF WHAT DR. RAO DID IS ENOUGH, HOW CAN IT POSSIBLY BE
13
THAT WHAT DR. HAUSER DID NOT BE?
14
IF WHAT DR. RAO DID IS ENOUGH TO DETERMINE DAMAGES, YOU
AND YOU'LL REMEMBER MY LAST CROSS-EXAMINATION OF DR. RAO.
15
DID ANYBODY ASK YOU, DID ANYBODY ASK YOU TO PERFORM A MAX DIFF
16
SURVEY, A CONJOINT SURVEY, ANY OTHER SURVEY THAT WOULD HAVE
17
SHOWN YOU WHAT THE APPLE FEATURES WERE WORTH?
18
AND THE ANSWER WAS NO.
19
IT.
20
ANSWER.
21
HE DIDN'T DO IT.
AND THERE'S ONLY ONE REASON.
NO ONE ELSE DID
THEY DIDN'T WANT TO KNOW THE
NOW, LADIES AND GENTLEMEN, WE'RE AT THE END OF OUR
22
CLOSING, AND BEFORE I SIT DOWN, I'D LIKE TO THANK YOU ON BEHALF
23
OF ALL OF US FOR YOUR CAREFUL TIME AND ATTENTION.
24
BEEN A BURDEN, A BURDEN UPON YOU, A BURDEN UPON YOUR FAMILIES.
25
WE KNOW IT'S
ON BEHALF OF MR. MCELHINNY AND MS. KREVANS AND ALL OF OUR
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COLLEAGUES, BUT MOSTLY ON BEHALF OF THE FOLKS AT APPLE, WE
THANK YOU.
NOW I'M GOING TO ASK YOU THAT LAST THING THAT I SAID I WAS
GOING TO ASK YOU TO DO, AND THAT'S THIS:
BEGIN YOUR DELIBERATIONS, PUT YOURSELF IN THE POSITION OF THE
APPLE ENGINEERS, SCIENTISTS, AND LEADERS.
POSITION OF SOME OF THE PEOPLE LIKE MR. CHRISTIE, MR. DENIAU,
MR. GARCIA, MR. MILLET, AND MR. SCHILLER.
9
10
PUT YOURSELF IN THE
LADIES AND GENTLEMEN, THESE ARE THE PEOPLE WHO CAME TO

WORK BEFORE THE SUN CAME UP AND LEFT AFTER THE SUN WENT DOWN.
11
12
BEFORE YOU RETIRE AND
MR. PRICE:
THIS ISN'T
REBUTTAL TO THE OFFENSIVE CASE.
13
MR. LEE:
YOUR HONOR, THIS GOES DIRECTLY TO
14
CHALLENGING THEIR PATENTS.
15
THE COURT:
16
MR. LEE:
OVERRULED.
THESE ARE THE FOLKS WHO WORKED TIRELESSLY,
17
AS MR. GARCIA DESCRIBED TO YOU, TO INVENT FACETIME, AND AS
18
OTHER DESCRIBED TO YOU, TO INVENT THE IPHONE AND THE IPOD
19
TOUCH.
20
THESE ARE PEOPLE WHO INVENTED AND INNOVATED AND
21
FUNDAMENTALLY CHANGED, FUNDAMENTALLY CHANGED THE WAY WE
22
COMMUNICATE.
23
24
25
AND FOR THESE FIVE PEOPLE, THEY CAME AND GOT ON THE STAND
AND UNDERWENT MUCH CROSS-EXAMINATION.
NOW, YOU'RE ONE OF THOSE PEOPLE, AND YOU'VE HEARD THAT THE
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SAMSUNG PATENTS ARE REVOLUTIONARY AND FUNDAMENTAL, PATENTS THAT
NO ONE HAS USED, THAT NO ONE HAD HEARD OF BEFORE THE LAWYER
GAVE IT TO THE EXPERT, AND THAT NO ONE HAS COPIED.
BUT YOUR WORK IS TRIVIAL AND UNIMPORTANT.
DOES THAT MAKE SENSE TO YOU?
AND YOU SAY TO YOURSELF, IF YOU'RE MR. GARCIA OR
MR. MILLET, HOW CAN THAT BE?
TRIVIAL AND UNIMPORTANT, BUT THESE PATENTS THAT NO ONE IS USING
ARE FUNDAMENTAL AND REVOLUTIONARY?
10
11
12
HOW CAN IT BE THAT OUR WORK IS
YOUR COMMON SENSE WILL TELL YOU WHAT THE ANSWER TO THAT
IS.
WE ALL WOULD AGREE THAT THE WORLD AND THE GLOBAL ECONOMY
13
DEPENDS UPON INNOVATION AND INVENTION.
14
PATENTS ISSUED BY THE UNITED STATES PATENT OFFICE UNDER OUR
15
CONSTITUTION.
16
DEPEND ON OTHERS TO RESPECT PATENTS, AND AS MR. DENISON SAID,
17
WE DEPEND UPON PEOPLE NOT TO ENGAGE IN THE UNFAIR COMPETITION
18
OF PATENT INFRINGEMENT.
19
WE DEPEND ON PATENTS,
WE DEPEND UPON FAIR AND SQUARE COMPETITION.
WE
AND MOST OF ALL, LADIES AND GENTLEMEN, WE DEPEND UPON
20
PEOPLE LIKE YOU WHO WILL RECOGNIZE THE DIFFERENCE BETWEEN FAIR
21
COMPETITION, FAIR AND SQUARE COMPETITION, AND UNFAIR
22
COMPETITION, THE UNFAIR COMPETITION OF PATENT INFRINGEMENT, AND
23
TO NOT ALLOW IT TO HAPPEN.
24
AND THAT'S WHAT WE ASK YOU TO DO NOW, HERE, TODAY.
25
THANK YOU.
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THE COURT:
THE TIME IS 2:46.
PLEASE COME FORWARD.
I'M GOING TO ASK MS. PARKER BROWN TO
SWEAR IN OUR BAILIFF, PLEASE.

(COURT SECURITY OFFICER SWORN.)
THE MARSHAL:
THE COURT:
I DO.
OKAY.
SO WHAT IS GOING TO HAPPEN IS THAT
YOU ARE GOING TO GET A COPY OF -- NO.
ACTUAL VERDICT FORM.
YOU'RE GOING TO GET THE
YOU'RE ALSO GOING TO RECEIVE 15 BLANK NOTES.
IF YOU
10
HAVE -- IF ANYONE ON THE JURY HAS ANY QUESTION, YOU CAN PLEASE
11
FILL OUT THE NOTE NUMBER, DATE, TIME, YOUR SIGNATURE.
12
AND WE WILL TRY TO RESPOND TO YOU AS QUICKLY AS WE CAN,
13
BUT PLEASE CONTINUE TO DELIBERATE.
14
ASSEMBLE EVERYONE AND JOINTLY AGREE UPON A RESPONSE TO YOU.
15
16
17
IT MAY TAKE US SOME TIME TO
SO WHENEVER YOU HAVE A NOTE, IF YOU WOULD JUST KNOCK ON

THE DOOR, YOUR BAILIFF WILL BE OUTSIDE.
ALL COMMUNICATIONS SHOULD BE IN WRITING BECAUSE THE
18
PARTIES ARE ENTITLED TO KNOW WHAT INFORMATION YOU ARE GETTING
19
WHILE YOU'RE DELIBERATING.
20
IN ADDITION, YOU WILL HAVE THE JOINT EXHIBIT LIST.
IF YOU
21
WANT TO FIND ANY OF THE EXHIBITS THAT HAVE BEEN REFERENCED
22
THROUGHOUT THE TRIAL, YOU'LL HAVE THIS INFORMATION IN THIS RED
23
WELL WHICH WE ARE GOING TO GIVE TO YOU.
24
IN ADDITION, YOU'RE GOING TO HAVE ALL OF THESE CARTS THAT
25
HAVE ALL OF THE EXHIBITS THAT HAVE BEEN ADMITTED INTO EVIDENCE,
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2
3
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SO YOU CAN LOOK AT ANYTHING IF YOU WISH.

SO TODAY WE'LL BE DELIBERATING UNTIL 4:30 AND YOU WILL
STAY IN THIS JURY ROOM.
BUT AS OF TOMORROW, I WOULD LIKE YOU TO DELIBERATE IN MY
JURY ROOM, WHICH IS ON THE FOURTH FLOOR.
ANYTHING IN OPEN COURT, WE'LL COME BACK TO THIS COURTROOM
BECAUSE I WILL HAVE OTHER CRIMINAL AND CIVIL CASES IN THE NEXT
TWO DAYS HAPPENING IN MY COURTROOM, BUT YOU'LL BE DELIBERATING
ON THE FOURTH FLOOR.
10
IF WE NEED TO DO
WHEN YOU GET OFF THE ELEVATORS AND GO BACK TO THE BACK
11
HALL, PLEASE TURN TO THE LEFT TO GO TO THE FIRST STREET SIDE OF
12
THE BUILDING INSTEAD OF GOING TO THE RIGHT TO THE SECOND STREET
13
SIDE OF THE BUILDING, WHICH IS WHERE WE ARE NOW.
14
SO YOU'LL BE DELIBERATING ON THE FOURTH FLOOR FOR THE REST
15
OF THE TIME, BUT THEN WE'LL ALWAYS COME UP HERE TO THIS
16
COURTROOM, SINCE THIS IS THE ONLY ONE LARGE ENOUGH, IF WE NEED
17
TO DO ANYTHING IN OPEN COURT.
18
19
20
21
22
ALL RIGHT.
SO WITH THAT, YOU CAN PLEASE TAKE YOUR BINDERS
AND GO TO THE JURY ROOM UNTIL 4:30 TODAY.

THE CLERK:
I'M JUST GOING TO GO BACK AND REMIND THEM
THAT I NEED THEIR LUNCH ORDER.

THE COURT:
OH, THAT'S FINE.
23
ALL RIGHT.
24
25
OKAY?
THE COURT:
OKAY.
THE RECORD SHOULD REFLECT THAT THE
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PLEASE TAKE A SEAT.
I WOULD LIKE EACH -- COUNSEL FOR EACH SIDE TO REVIEW THE
MATERIALS THAT ARE ACTUALLY GOING BACK TO THE JURY ROOM.
WANT TO HAVE EVERYONE ON THE RECORD SAY THAT THEY ARE OKAY WITH
THESE PARTICULAR MATERIALS.
SO ONE IS THE JOINT EXHIBIT, JOINT LIST OF EXHIBITS
ADMITTED THROUGH APRIL 28TH, 2014.
1857, AND I WILL GIVE YOU AN OPPORTUNITY TO REVIEW THE ACTUAL
10
THE ECF DOCKET NUMBER IS
COPY.
11
ANOTHER ONE ARE THE BLANK JURY NOTES.
12
THE THIRD IS THE VERDICT FORM, WHICH IS ECF DOCKET NUMBER
13
14
15
16
1836.
LET ME ASK MS. PARKER BROWN IF YOU CAN LET THEM SEE THOSE
MATERIALS.
AND WE DO HAVE AGREEMENT AS TO THE EXHIBITS, CORRECT?
CAN
17
YOU PLEASE IDENTIFY WHICH ARE THE CARTS THAT WILL BE GOING TO
18
THE JURY ROOM?
19
THE CLERK:
SO THEY'RE GOING TO INSPECT THIS?
20
THE COURT:
YES, IF YOU WOULD, PLEASE.
21
WHICH ONES ARE THE CARTS THAT ARE GOING TO THE JURY ROOM?
22
THE CLERK:
THESE TWO AND THE DEVICES, I BELIEVE.
23
MR. SABRI:
THAT'S RIGHT.
24
THE COURT:
ALL RIGHT.
25
SO LET'S JUST PUT ON THE
RECORD, I WANT SOMEONE TO IDENTIFY THEMSELVES FOR APPLE AS
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APPROVING THE TWO BEIGE CARTS FULL OF BINDERS AND THE TWO BLACK
CARTS FULL OF DEVICES THAT ARE IN RED WELLS.
SOMEONE --
CAN I HAVE
MR. SABRI:
NATHAN SABRI FOR APPLE, YOUR HONOR.
THE COURT:
AND YOU APPROVE OF THOSE FOUR CARTS?
MR. SABRI:
YES, YOUR HONOR.
THE COURT:
ALL RIGHT.
8
9
10
11
MS. MAROULIS, DO YOU APPROVE
OF THOSE FOUR CARTS?

MS. MAROULIS:
THE COURT:
YES, YOUR HONOR.
OKAY.
THANK YOU.
THEN I'M GOING TO HAVE MS. PARKER BROWN -- MS. PALANJIAN,
12
MR. HUANG, MAYBE YOU CAN HELP -- WHEEL THOSE INTO THE JURY
13
ROOM, PLEASE.
14
15
OKAY.
MR. SABRI, HAVE YOU REVIEWED THE VERDICT FORM, THE
EXHIBIT LIST, AND THE JURY NOTES?
16
MR. SABRI:
I HAVE, YOUR HONOR.
17
THE COURT:
OKAY.
18
MR. SABRI:
YES, YOUR HONOR.
19
THE COURT:
ALL RIGHT.
20
21
22
23
24
25
ARE THOSE SATISFACTORILY TO APPLE?
MS. MAROULIS, HAVE YOU
REVIEWED THE VERDICT FORM, THE JURY NOTES, AND EXHIBIT LIST?
MS. MAROULIS:
YES, YOUR HONOR.
THEY'RE SATISFACTORY
FOR SAMSUNG.
THE COURT:
OKAY.
THANK YOU.
SO THOSE WILL GO BACK
TO THE JURY ROOM.

I DID JUST WANT TO PLACE ON THE RECORD AS WELL THAT THE
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FINAL JURY INSTRUCTIONS THAT WERE READ TO THE JURY YESTERDAY
WERE ECF DOCKET NUMBER 1847.
3
4
HAVE YOU PROVIDED YOUR BEST MEANS OF CONTACT AND CONTACT

INFORMATION TO MS. PARKER BROWN?
MR. MCELHINNY:
MS. MAROULIS:
THE COURT:
WE HAVE, YOUR HONOR.

YES, YOUR HONOR.
OKAY, GREAT.
SO WE KNOW HOW TO CONTACT
YOU.
WE WILL DO IT, AS WE'VE DONE THE PREVIOUS TWO TRIALS, WHEN
10
THE JURORS LEAVE FOR THE END OF THE DAY, WE'LL JUST HAVE A
11
MESSAGE FILED ON ECF SAYING THE JURORS HAVE ADJOURNED FOR THE
12
DAY.
13
WE'LL ALSO DO, AS WE'VE DONE IN THE PREVIOUS TWO TRIALS,
14
WE WILL FILE THE JURY NOTES SO IF YOUR TEAMS ARE DISPARATE,
15
EVERYONE CAN GO ONLINE AND SEE WHAT THE QUESTION WE HAVE.
16
17
18
19
WE HAVE MR. MINTZ HERE, HE'LL BE OUR LIAISON TREE FOR THE
MEDIA, AS IN THE PREVIOUS TWO TRIALS.
WHAT ELSE?
ORGANIZE?
20
21
22
23
ANYTHING ELSE THAT WE NEED TO COORDINATE?
MR. MCELHINNY:
NOTHING FURTHER FOR APPLE, YOUR
HONOR.
THE COURT:
OKAY.
ANYTHING -- ANYTHING MORE THAT WE
SHOULD COORDINATE?
24
MS. MAROULIS:
25
THE COURT:
NOTHING FURTHER, YOUR HONOR.
OKAY.
THEN THANK YOU VERY MUCH.
WE'LL
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GO AHEAD AND LET YOU KNOW WHEN THEY ADJOURN FOR TODAY AND IF WE
HAVE ANY NOTES.
(A RECESS WAS TAKEN PENDING THE JURY'S DELIBERATIONS.)
4
5
6
7
8
9
10
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12
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CERTIFICATE OF REPORTER
3
4
5
6
7
I, THE UNDERSIGNED OFFICIAL COURT REPORTER OF THE UNITED
STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA,
280 SOUTH FIRST STREET, SAN JOSE, CALIFORNIA, DO HEREBY
10
11
CERTIFY:
THAT THE FOREGOING TRANSCRIPT, CERTIFICATE INCLUSIVE, IS
12
A CORRECT TRANSCRIPT FROM THE RECORD OF PROCEEDINGS IN THE
13
ABOVE-ENTITLED MATTER.
14
15
17
_______________________________
18
DATED:
16
APRIL 29, 2014
19
20
21
22
23
24
25
EXHIBIT 5
TENTATIVELY FILED
UNDER SEAL
1
2
3
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5
6
7
8
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12
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ahurst@orrick.com
gramsey@orrick.com
Tel: 1.415.773.5700 / Fax: 1.415.773.5759
pbicks@orrick.com
lsimpson@orrick.com
Tel: 1.212.506.5000 / Fax: 1.212.506.5151
dboies@bsfllp.com
Tel: 1.914.749.8200 / Fax: 1.914.749.8300
Tel: 1.510.874.1000 / Fax: 1.510.874.1460
ORACLE CORPORATION
500 Oracle Parkway,
Tel: 650.506.5200 / Fax: 650.506.7117
22
23
24
25
26

Plaintiff,
v.
GOOGLE INC.
Defendant.

[PROPOSED] ORDER GRANTING
ORACLES MOTION TO DISQUALIFY
THE RULE 706 EXPERT
27
28
[PROPOSED] ORDER
CV 10-03561 WHA
Before the Court is Oracle America, Inc.s Motion to Disqualify the Rule 706 Expert.
Having considered the Motion, and all matters presented to the Court in connection with the
Motion, the Court HEREBY ORDERS that the Motion is GRANTED.
4
5
6
7
IT IS SO ORDERED.
8
9
10
Dated:
,
Honorable William H. Alsup
United States District Court Judge
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-1-
[PROPOSED] ORDER
CV 10-03561 WHA

15-10-15 Oracle Motion To Disqualify Damages Expert

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Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 1 of 9

ORRICK, HERRINGTON & SUTCLIFFE LLP

NORTHERN DISTRICT OF CALIFORNIA

ORACLE AMERICA, INC.,

Case No. CV 10-03561 WHA

Date: November 19, 2015

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 2 of 9

NOTICE OF MOTION AND MOTION

TO ALL PARTIES AND THEIR COUNSEL OF RECORD: PLEASE TAKE NOTICE

light of the reduced scope of the case.

presented prior to or at the hearing on the Motion.

Dated: October 15, 2015

/s/ Peter A. Bicks

Attorney for Plaintiff

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 3 of 9

MEMORANDUM OF POINTS AND AUTHORITIES

It Is Inappropriate For Dr. Kearl To Remain As A Neutral Expert.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 4 of 9

unimpeachable, ECF 350 at 23.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 5 of 9

libraries entirely from scratch.

offense, defense, or special teams.

Samsung. See Samsung docket 12-CV-00630-LHK. There was effectively no difference

between Samsung and Google.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 6 of 9

not worth much.).

amount I used in my calculations. Samsung Tr. 2673-74.

See Bicks Decl. Ex. 5 (Dr. Kearl Apple v.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 7 of 9

another case. Samsung Tr. 3319.

Given Dr. Kearls participation in Samsung/Googles defense, he should not remain as

A Rule 706 Expert Is No Longer Necessary.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 8 of 9

disease of unknown cause).

parties expert reports.

A Rule 706 Expert Should Not Testify At Trial.

testify at the trial.

Case 3:10-cv-03561-WHA Document 1340 Filed 10/15/15 Page 9 of 9

By: /s/ Peter A. Bicks

Case 3:10-cv-03561-WHA Document 1340-1 Filed 10/15/15 Page 1 of 3

ORRICK, HERRINGTON & SUTCLIFFE LLP

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

ORACLE AMERICA, INC.

Case No. CV 10-03561 WHA

Case 3:10-cv-03561-WHA Document 1340-1 Filed 10/15/15 Page 2 of 3

I, Peter A. Bicks, declare and state as follows:

testify competently to the matters stated herein of my own personal knowledge.

Attached as Exhibit 2 is a true and correct copy of Exhibit 3010 in Apple v.

videotaped deposition was played to the jury.

DECLARATION OF PETER A. BICKS

Case 3:10-cv-03561-WHA Document 1340-1 Filed 10/15/15 Page 3 of 3

/s/ Peter A. Bicks

DECLARATION OF PETER A. BICKS

Case 3:10-cv-03561-WHA Document 1340-2 Filed 10/15/15 Page 1 of 232

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

APPLE INC., A CALIFORNIA

APPEARANCES ON NEXT PAGE

OFFICIAL COURT REPORTERS:

LEE-ANNE SHORTRIDGE, CSR, CRR